Mining in the Philippines

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Mike Wootton

I remember proposing once at a conference of NGOs in the Philippines that mining companies provide funding for measures to allow the monitoring of mining activities potentially harmful to the community or the environment. The proposal was not at all popular. Mining, during that particular form, was seen at the very least “the work of the devil himself”. Shortly after that eye-opener, I became involved in an inter (foreign]) government oversight group tracking foreign mining investment in the Philippines. Our goal was to ensure that foreign investor miners carried out their activities in a transparent and socially responsible way. Sometime after this, the fledgling Extractive Industries Transparency Initiative (EITI) paid a visit i ntending to ask the Philippines to join their organisation, which it did.

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The operations of mining companies can be a highly emotive topic. Big money is involved and a wealth of job opportunities, at least while the commodities markets favour the mined product. Once the commodity price falls, the mines will often close down and everybody laid off. The EITI has worried a lot about corruption in the mining industry, and not without some justification. It also worried about safety standards — mining operations are dangerous, just look at the collapse of the opencast Semirara coal mines. They collapsed twice, in 2013 and 2015, killing about 15 people. Yet it still continues to operate.

Open-cast mining is almost bound to be a blot on the landscape. The results are huge apocalyptically barren areas and fatally compromised watersheds. The environmental impact of mining includes erosion, formation of sinkholes, loss of biodiversity and contamination of soil, groundwater and surface water by chemicals from mining processes. By its very nature, the mining process is most likely to negatively impact the environment.

Massachusetts Institute of Technology (MIT) has produced a table summarising many of the effects of contaminants released during risk events in mining operations, but these are not all;

Mining is necessary to feed industries that produce things essential to economic development. The Philippines is the world’s biggest producer of nickel ore. Without nickel, there would be no stainless steel, food preparation equipment, mobile phones, medical equipment, transport, buildings, power generation and so on.

The question is how to continue to extract vital natural materials whilst protecting the environment and public health. Unless and until better technology is available for mining, particularly open cast, the only way to mitigate negative environmental effects is to ensure and enforce environmental rehabilitation, both during and after mining operations cease. Despite that, there will be temporary effects on biodiversity systems and watershed maintenance and the risk events will still be latent.

To get an Environmental Compliance Certificate (ECC) for open-cast mining in the Philippines requires the preparation of an environmental management plan, showing that proposed operations will not significantly affect the environment and that mitigation measures will be undertaken; flattening waste material dumps, filling in excavations, treating ground water and restoring biodiversity systems. All are summarised in a final mine rehabilitation and commissioning plan submitted after the grant of an ECC. (Although it would make more sense to include this as a part of the ECC application!)

There is a particular problem, however, attached to this, which is, of course, corruption. Since the cost of professionally rehabilitating open-cast mine activities is prohibitive, especially if some of the rehabilitation is done during the operations, some companies may prefer not to honour these obligations. The answer to this must be enforcement of adherence to the rehabilitation plan, and that enforcement must be honest and unable to be influenced by any corrupt activity. But environmental degradation is not the whole issue, there are important safety issues to consider as illustrated by the Semirara cases.

The Philippines is comparatively rich in natural resources. However, they remain underutilised for many reasons, not just environmental and safety related issues. These natural resources should be monetised in order to produce a significant and necessary improvement to the national economy, provided that such development is done in a responsible, open and transparent way.

What plagues the mining industry likewise plagues many other sectors in the Philippines such as the uncertainty of rules and regulations, the frequently inappropriate bureaucratic barriers, the relative ease with which good rules are disregarded, the politicking that surrounds every activity and the lack of true professional competition.

So yes, the Philippine mining sector should develop further. Its growth will be good for the economy. But if the country wants to achieve advanced economic status, whilst at the same time nurturing a more egalitarian society, those tasked with oversight of the mining sector should simplify the rules and enforce them vigorously, ensuring that they are not swayed from the path towards responsible and transparent mining operations. It’s a tall order, but let’s hope not too tall.
Good luck!

Mike can be contacted at mawootton@gmail.com

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