Decision time looms for the mining industry

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IN spite of our misgivings, and obviously, the fears of nearly every stakeholder in the Philippines’ mining sector, the method to the apparent madness of the aggressive campaign to ‘clean up’ the nation’s mining industry by Environment Secretary Regina Paz Lopez is becoming clear, and may just lead to a more sustainable and productive future.

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There have been three significant developments since Lopez, who as an environmental activist has been publicly very vocal about her distaste for mining in general, took over as head of the Department of Environment and Natural Resources.

First, as Reuters noted in a report on Wednesday, 10 major mining operations have been at least temporarily put out of business for various environmental infractions. Second, Lopez has subjected those who remain to a stringent audit, assessing the companies’ compliance with environmental laws, health and safety regulations, other local and national laws and regulations, and good corporate citizenship. And third, a bill that would require miners to invest in processing of mineral ores here in the Philippines and wind down ore exports over the next three to five years has been refiled in the House of Representatives, where it has a good chance of passage, unlike in 2014 when it was first introduced.

Sifting through all the rhetoric from both sides of the issue, it becomes clear that Lopez has actually been very consistent in her perspective. Mining is invariably environmentally harmful, but cannot be completely ignored as a source of national wealth; the Philippines is, according to various statistics, the seventh-most mineralized country on the planet, and as of now is the world’s largest nickel producer. If mining must be done – and the reality is, if the country wishes to grow its economy, it must make use of its native wealth – then Lopez is simply insisting that it be done in a manner that causes the least amount of environmental damage, mitigates what damage cannot be avoided, and reserve the greater part of the benefits for the communities who are most affected by it.

The proof of Lopez’s consistency in her objectives might be found in the positive reactions, grudging though they may be, of many mining interests. While still expressing some worry that the apparently harsh policies may dampen investment, big mining firms have described the DENR’s audit process – which is largely being handled by the Mines and Geosciences Bureau – as “tough but fair,” and lauded Lopez for faithfully following the directive of President Rodrigo Duterte to ensure that companies in the sector “do mining right or get out,” as it will, at the very least, prevent substandard players from bringing discredit on the entire business.

And now with the third development, the push to keep mineral ore in the country, where its processing will help support the goal of building the industrial sector, the whole plan becomes clear: What is being created, if the mining sector is willing to take part in it, is nothing less than a model industry, one that supports the Philippines’ self-reliance and produces wealth for the country in as sustainable a way as possible.

Much work remains to be done, however. As the mining industry correctly points out, investment in metals processing is currently unattractive without improvements in infrastructure and the country’s electricity sector. And Lopez has yet to direct her attention in a significant way to what is possibly the biggest source of environmental damage from mining: the small-scale mining sector, almost all of which operates illegally.

Those issues, while formidable, can be dealt with; what the mining sector needs to decide is whether or not what has happened in the past seven weeks is sufficient evidence that their patience with an environment that now may seem a little uncertain will eventually pay off. Provided the President and his energetic Environment Secretary stay their present course, we believe it will.

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4 Comments

  1. If the government chooses to impose costly demands on foreign investors in the mining industry, it is likely that those investors will choose to invest elsewhere. Like any industry, the Philippines holds no monopoly on mineral assets, and companies will act to ensure that they can earn reasonable returns, free of political risks. The Duterte is not putting out the welcome mat to foreign investment, but in fact is doing the very opposite so far as mining is concerned. Don’t expect these policies to lead to a rush of investment; if anything, they are likely to lead to a further drying up of investment, employment, production, incomes, and taxes.

  2. I agree that our natural wealth mus t be harnessed to the well being of our citizenry. But government should look into mining priorities. Mine those natural wealth that would bring more benefits ( socio economics benefits ) not only benefits to stakeholders who are mostly the rich and the foreigners. And the most viable is the Phil Deep wealth that is consonance to the directives of the NEW WORLD of green energy source ..DEUTERIUM. I advocate that if RP will mine this natural wealth RP will be starting a new world trend…new schematics for all machineries run by OIL derivatives and we can patent what ever new machineries RP scientists and engineers can invent new schematics based DEUTERIUM and we can call them DEUTERTE in honor of the BRAVE ONE DU30. Spare all those mining in other minerals GOLD, SILVER and the likes many countries are also mining those and price competion is stiff hence earnings are minimal. Mine DEUTERIUM and invent new machines RP Progress will be assured…NO MORE OFW. My two cents worth….

  3. Without a doubt, any harm caused by mining can be attributed to poor enforcement of the Mining Act of 1995 and existing DENR Regulations. That said, there is no need for new legislation. Like it says here, the present law is already ‘tough but fair’. Calling for new laws is the usual kneejerk response to distract us from the real problem of poor enforcement. Demanding a new law makes it look like our officials are doing something, while acknowledging poor enforcement means admitting government has been remiss.
    On the other end of the spectrum, while the law is certainly ‘tough but fair’, we have to make sure that the ones monitoring and enforcing it are also fair. One of the mining companies being criticized by the DENR claims that the auditing had been rushed, only a matter of hours for something that takes days or even weeks, and that key officials of the mining company were not consulted. If this is indeed, true and it becomes the norm, then even responsible mining and their attendant investors truly have much to fear.

  4. Meron pa rin pong pwersa na nagsusuporta ng mining dahil napaka importante daw itong factor sa progreso ng bansa. Boto po ako doon pero hindi po applicable ito sa Pilipinas dahil bawat hectaria niya ay puno ng yamang lupa at yamang dagat. Tulad sa Batangas. Confirmado po na sa may Isla Verde ay ito ang “Center of the Center of Biodiversity” in the WORLD. Ang sinasabi po ni Mom Gina ay hindi opinion lang kundi isang sincere expression ng isang enlightened na malasakit. Doon po sila dapat magmina sa bansang malalaki na siguradong maraming mamimina. Kung bakit ayaw nilang magmina sa kanilang bansa ay maliwanag na affirmation na tama si Mom Gina at Pres Digong sa kanilang advocacy.