BY KATRINA MENNEN A. VALDEZ Reporter

THE Philippines will soon shut doors to investors that would only export ore and not process them using innovative technology before shipping abroad, the Department of Environment and Natural Resources (DENR) said.

Newly appointed DENR Secretary Horacio Ramos said the government five years from now will no longer allow mining companies to extract minerals and not undergo any innovative processing of the commodities.

The government wants the mining industry to move beyond mere extraction and into higher value-added processing of the minerals, thus generating more job opportunities and additional state revenues.

“Of course, there were some protests from mining investors since it would require more capital on their part. However, that is the rule that we have to impose and implement so as to protect the interest of the country’s environment, economy and welfare,” Ramos said.

According to the Board of Investments, an integrated mining and steel manufacturing plant would entail at least $1 billion in capital.

Under the 2010 draft of the Investments Priorities Plan (IPP), mining is still on the list of mandatory activities enjoying tax and other perks, as provided for in the Philippine Mining Act of 1995. Mining activities cover the exploration and development of mineral resources, mining, quarrying and processing of metallic and non-metallic minerals.

However, ore exports would no longer enjoy fiscal incentives and other perks, and come 2015, would already be disallowed.

One of the disadvantages of ore exports is that mineral composition deposits could not be extracted by a traditional or low-end plant. Thus, low-grade minerals or deleterious composition will not be fully used and would be put to waste.

Low-grade minerals are also doing well in the world market in terms of demand and value. Examples of these are copper—at $3.15 to $3.50 per pound—and nickel-at $9.15 to $9.55 per pound.

The DENR chief said the agency is drafting the memorandum order, which will be presented to the Office of the President this week.

Since 2004, investments in the mining sector have reached $2.5 billion. The government is projecting to bring in $10 billion to $12 billion in such investments by 2013.