Between the Devil and the Deep Blue Sea

Because the Tampakan Project is still hot news today (yes, in spite of the impeachment trial’s hogging the daily news), I sent a coverage crew to the recently-held press conference called for by Sagittarius Mines Inc., (SMI) the main proponent in the project. It was a rather short presscon, but SMI came prepared.

One of those in the panel was Mr. David Pearce, executive director of the Center for International Economics which was commissioned by SMI to do a study on how mining, the Tampakan Project specifically, can impact Philippine economy. Earlier on, at the Marriott Hotel in Pasay City, he showed how the Tampakan copper-gold project is potentially a game-changing factor for the Philippine economy, the benefits ranging from taxes and royalties down to employment, services and consumerism. This was a public forum hosted by the Chamber of Mines of the Philippines, which lately, has been kept busy keeping the militant environmentalists and anti-mining groups at bay.

Understandably, SMI is fighting tooth and nail for the project to break ground. This is one of the largest undeveloped copper deposits in the world, and if they are finally allowed to start commercial mining operations here, it will be the largest mine in the Philippines valued at $5.9 billion. Another big foreign investment mining concern is Oceanagold Corporation, an

Australian gold producer whose project at the Didipio mine in Luzon is valued at $185 million, a far second to the Tampakan project. Should the SMI project push through, this would put

Tampakan among the top 10 mines in the world. The provincial government of South Cotabato stands pat on its ban on open pit mining, which is precisely the reason given by DENR Secretary Ramon Paje for his denial of an En

vironmental Compliance Certificate to SMI, a fundamental requirement for all commercial mining operations. Sec. Paje says that since the proponents submitted themselves to the process of consultation with the provincial government, then they necessarily have to go through and finish the process, even if the local ordinance runs against a current national policy which allows open pit mining in the country.

Curiously, two mayors from the municipalities of Kidlawan and Tampakan in South Cotabato were at the presscon. Tam

pakan Mayor Leonardo Escobillo brought along with him a book-bound compilation of petitions, allegedly signed by 90 percent of his constituents in support of the Smi-tampakan project. Addressed to the President of the Republic, he was set to present it himself to P-noy to show that the municipality was all for the project and invited representatives from the national government to “investigate.. make an ocular inspection and have a dialogue with our people.” Mayor Marivic Diamante of Kidlawan referred to the Social Weather Station survey held in South Cotabato in her bid to show that the people there are for “responsible mining and they are amenable to the operations of Sagittarius Mines.” She also said that the President was their guest speaker in March 2011 and remarked that the President was very vocal about pushing for large-scale mining, so why the change of heart now, if indeed the sentiments of the President are against the project? Another resource person at the panel was the president of the

Mindanao Business Council, Mr. Vicente Lao, who recounted that his organization was never really involved in the issue until an anti-mining rally masked as a forum was held in their province where only one side of the issue was presented. He said “the Mindanao Business Council feels that that’s not fair” and decided to come out with a stand on the issue.

The eloquent Mr. Lao bemoaned the fact that “Mindanao has always been at the tail end of receiving benefits from the national government… six out of 10 poorest in the country come from Mindanao… we cannot afford to have these projects scuttled because of objections from a few groups that are based in Manila.” He added that, though Mindanao is now totally focused on improving and expanding its agriculture production, it still undeniably accounts for a very insignificant contribution to the province.

Actually, the non-issuance of an ECC to Sagittarius is not in itself a death sentence for the project as the DENR decision is subject to reconsideration. A motion is now pending, in fact, and as SMI president Peter Forrestal himself said, “if that motion is rejected, I guess we can appeal to the President, go to the courts, (there are) a number of things that we can and will pursue if we need to.”

We also had a chance to talk with Mines and Geosciences Bureau director Leo Jasareno who informed us that 2011 was a difficult year for the mining industry due to the moratorium imposed by the DENR on new mining applications. At present, the country has more than 500 million lease contracts, permits and agreements. The industry got a boost when, in

2004, the Supreme Court reaffirmed a lower court’s ruling allowing foreign investors to own mining companies here, skirting a long-established constitutional ban.

Mr. Jasareno, though, confirmed that with 31 large scale metallic mine operators, the country’s mineral exports were still good in 2011, largely because metal prices have remained high in the global market. This is especially true with gold which is enjoying unprecedented prices, while nickel prices remain satisfactory.

The present administration is indeed mulling more stringent rules to ensure environmental protection and is likewise poised to possibly withdraw incentives that mining investors are currently enjoying. The Joint Foreign Chambers of the Philippines has cautioned the national government about such a move, saying that this “creates great uncertainty for established and potential investors into the Philippines.” The President’s marching orders are to enhance the revenues from mining, and this can be done through higher taxes and royalties from these foreign miners and revisit the tax holidays and other incentives they are now currently enjoying. Why not indeed when mining is a multibillion dollar, highly profitable industry. What other incentives would they need other than the valuable minerals they extract from our land? The Philippines sits on vast untapped mineral wealth estimated to be worth $1 trillion. With the proper policies in place, this could ensure generous socio-economic benefits for our people on the long term. Mabuhay!!! Be proud to be a Filipino. For comments: (e-mail) businessleisure-star@stv.com.ph