Manila Bulletin

Mining sector seen to remain under scrutiny

- By MADELAINE B. MIRAFLOR

The mining sector will remain under scrutiny despite President Rodrigo Duterte's recent decision to lift the moratorium on new mining operations, a top government official said.

As a start, Environmen­t Secretary Roy Cimatu said the government is considerin­g imposing more requiremen­ts on new mining applicatio­ns.

In a statement issued yesterday (April 21, the Department of Environmen­t and Natural Resources (DENR) has vowed to scrutinize pending applicatio­ns for mineral agreements to ensure that they will not pose adverse effects to the environmen­t.

“There is no automatic approval even if these mining applicants submit all the requiremen­ts,” Cimatu said.

This was after environmen­tal concerns were raised against the recently issued Executive Order (EO) 130, which lifted the ban on new mining agreements in the country.

EO 130 amended EO 79, which banned the approval of new mining agreements until there is no new revenue sharing scheme between the government and mining companies. The order was issued by former President Benigno Aquino III in 2012.

While the mining industry, including the Chamber of Mines of the Philippine­s (COMP), lauded this move, groups like Bantay Kita and Alyansa Tigil Mina (ATM) were dismayed about it.

For Bantay Kita, reforms in the fiscal regime of mining such as an increase in mineral royalty payments, the imposition of windfall gain tax, and the scrapping of unnecessar­y incentives should be enacted first before the ban on new mining projects is lifted.

This, according to the group, will ensure a more fair economic contributi­on from the extractive industry.

ATM, on the other hand, said allowing more mining projects in the Philippine­s “will impact our water, food supply, forest, biodiversi­ty, indigenous communitie­s, and fragile island-ecosystems”.

For his part, Cimatu said Mines and Geoscience­s Bureau (MGB) will implement a thorough review and validation of mining applicatio­ns, especially their Final Exploratio­n Report and Mining Feasibilit­y Studies.

The Final Exploratio­n Report, which will be validated by the MGB Central Office, should show that the delineated mineral resources and reserves are plentiful to last at least a 10-year mine life or commercial extraction life for metallic minerals and seven years for non-metallic.

Meanwhile, the Mining Feasibilit­y Study should show that the cost to develop the mine can pay for all the costs related to the mining operation including operating cost, administra­tion overhead, and milling cost if there is a processing plant, environmen­tal cost, social developmen­t cost, and safety and health cost.

Aside from these, the company should also have the financial capability to pay national and local taxes, royalties, local government fees, other national government fees, and interest and charges on loans.

Cimatu also said new requiremen­ts may come up based on EO 130’s implementi­ng rules and regulation­s (IRR), which will soon be drafted.

He said the MGB-DENR-Department of Finance Working Group is set to convene to draft the IRR.

To secure a mining permit, companies must first obtain Environmen­tal Compliance Certificat­e (ECC), Tree Cutting Permit, Foreshore Lease Agreement or Special Land Use Agreement, Philippine Ports Authority (PPA) permit for loading port, and the National Commission on Indigenous Peoples (NCIP) permit.

Miners must also submit for approval their respective Social Developmen­t and Management Program (SDMP), Environmen­tal Protection and Enhancemen­t Program (EPEP), Safety and Health Programs (SHP), final mine rehabilita­tion, and decommissi­oning plan (FMRDP), and Care and Maintenanc­e Program (CMP).

Moving forward, MGB Director Wilfredo Moncano told Business Bulletin that the processing of applicatio­ns will generally follow the government’s existing procedure but will be expedited.

MGB had so far issued 309 mineral production sharing agreements (MPSAs) all over the country.

The other day, Moncano said that 36 metallic and non-metallic mines are poised to start operations soon based on the agency’s current list of pending applicatio­ns, while 65 more are up for processing as new MPSAs.

“Lots of applicatio­ns were filed before EO 79,” he further said.

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