Mining royalties up 32% P763.66M in Jan.-June

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ROYALTIES collected from miners operating within mineral reservation areas increased by almost a third in the first half of 2015, the Mines and Geosciences Bureau (MGB) said on Tuesday.

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In a report on Tuesday, the bureau said the government generated P763.66 million in royalties in January to June 2015, up by 32.2 percent from P577.55 million during the same period last year.

The amount represents 5 percent of the market value of the gross output of the minerals produced in the first six months.

MGB Director Leo Jasareno attributed the increase in royalty payments to the higher production value and additional volume after two mines in the mineral reservation areas joined the production stream.

In the first quarter of 2015 alone, the country’s metal sales reached P23.72 billion, up 7.17 percent from P22.14 billion a year earlier. Higher output helped offset weaker metal prices as demand slowed down and supplies raise the surplus levels in the market.

At present, the government-declared mineral reservation areas are in Zambales in Region III, as well as Surigao del Norte, Surigao del Sur and Dinagat Islands in Region XIII.

Under Section 5 of Republic Act 7942, or the Philippine Mining Act of 1995, 10 percent of the royalties will accrue to the MGB for “special projects and other administrative expenses related to the exploration and development of other mineral reservations.”

The 90 percent shall be divided between the national government and the local government where the minerals are located on a 60-40 sharing agreement.

Joint Circular 2010-1, an order signed by the Departments of Environment and Natural Resources, of Finance, of Budget and Management, and of Interior and Local Government provides the guidelines on how the share of local government units from royalty payments must be released.

For the first half of 2015, the share of local governments amounted to P274.92 million.

In 2014, the amount of royalties reached P2.69 billion.

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