Mining exec: Taxpayers might shoulder cost of closure

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Filipino taxpayers might have to shoulder the cost of the moved by Environment Secretary Regina Paz Lopez to cancel or suspend mining contracts without due process, an executive of the second largest nickel producer in the country claimed on Wednesday.

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In a roundtable discussion at Lido Cocina Tsina, Global Ferronickel Holdings Inc. President Dante Bravo said the Filipino people would eventually foot the bill, which could easily reach billions of dollars, should the government lose an arbitration case to be filed by miners affected by the cancellation of contracts of mines in mid- development stage or already operational.

“Under the law, there is an investment, so this amounts either to an expropriation, with the cancelling and all that, just take over this mine or say requisition investment,” Bravo noted.

“At the end of the day, Congress will have to pass a law to pay for this damage or for the return of investment for all the mining companies affected. And, eventually, it will be collected through taxes. It’s going to be the Filipino people who will shoulder it,” he further claimed.

The Chamber of Mines of the Philippines earlier said several mining companies are mulling over a series of court cases against Lopez in relation to what they claimed as the unlawful suspension and cancellation of mining contracts.

Bravo noted that mining companies such as FNI would demand full reimbursement—including loss of wealth, actual investment directly poured in by the company, and damage to reputation as a result of the decision made the Department of Environment and Natural Resources (DENR) secretary.

“We did not violate, but we are being labeled as irresponsible. We’re being labeled as violators. Is it something that can be corrected by saying: ‘Okay. We made a mistake. Our basis in saying that all of you violated the law or all of you caused social injustice or all of you caused suffering,’ because these are all attacks against our integrity, against our reputation,” Bravo claimed.

On Tuesday, Lopez, who earlier admitted that she lacked the technical knowledge of the mining industry, ordered the cancellation of mineral production sharing agreements (MPSA) of 75 mining companies operating in watershed areas.

She said that the mining contracts–37 mines in Mindanao, 27 in Luzon and 11 in the Visayas–were located in identified watersheds.

With many in exploration stage and have yet to start production, the DENR chief is not allowing the mine to be developed further. The move came in the wake of an earlier decision to shutdown 23 mining operations and suspend 5 others.

COMP has scored Lopez for what the group claims as a unilateral decision and disregard of due process in the cancellation of the MPSAs.

“The recent announcement of DENR secretary-designate Regina Paz Lopez cancelling the MPSAs of 75 projects, including several that are yet to start, and the Tampakan Environmental Compliance Certificate, is no longer a question of whether you are pro or anti-mining,” COMP said in a statement.

Upholding the sanctity of contracts is a requisite to the democratic process that must be upheld, the mining lobby group said.

“This act by the secretary-designate impinges on our right to due process and runs against good governance,” the chamber claimed. “The MPSAs were entered into by government and us as mere contractors in the development of these mineral lands.”

COMP said the cancellation of the agreements does not rest on Lopez alone but must be collectively decided upon by the President and the Cabinet, considering the adverse impact of the decision.
 
‘Re-angulation’
Lopez, a staunch anti-mining advocate, defended her decision to shut down the mines and cancel mining contracts, saying that mining in watersheds is non-negotiable.

“Water is life, and by saying, by today, doing show cause to all mining companies that were granted MPSA, there should be no mining in watershed areas,” she said.

“What happens when you adversely affect a watershed? You dry up the resource. There should be no mining in watershed areas,” she said.

However, when asked by reporters on what types of watershed should be considered as a no-go zone to mining, Lopez failed to come up with a definitive scientific definition for her decision.

Environment Undersecretary for Legal Ipat Luna told reporters that Lopez, as secretary of DENR, exercises her discretion based on “re-angulation of several facts.” The official, however, did not expound on her statement.

COMP Executive Vice President Nelia Halcon sought further explanation from Luna on the basis of the re-angulation, saying that government decisions should be anchored on facts and laws.

“Mahirap magsabi ng mali at tama without seeing the ‘facts.’ As an economist, we always consider official facts, figures, and if ever we refute it, we based it on survey results,” Halcon said.
 
‘Buying time’
Halcon claimed Lopez may be “buying time” to convince the public and the Commission of Appointments that “she’s doing the right thing,” citing the recent media campaign launched prior to the cancellation of mining contracts.

The chamber filed an opposition to the confirmation of Lopez due to her alleged biases against large-scale players.

“We believe in the reasonableness of the CA. Pero ‘yong deferment was, I think requested from her, and there a may be reasons that we don’t know. Maybe to convince the people na tama ginagawa niya, particularly the public,” Halcon claimed.

The mining official emphasized that COMP based its appeal on Lopez’s recent actions and pronouncements as DENR Secretary, which, the group alleged, “show an undeniable bias against and antagonism towards large-scale mining, rendering her unfit and incapable of a responsible, fair, just and balanced implementation of the Constitution, the Philippine Mining Act and related laws and regulations, and of upholding personal interest and advocacies over public interest.”

COMP said its members repeatedly tried to work with the secretary-designate, but alleged that after 8 long months, the secretary-designate was unwilling to work with the industry.

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