Environment department allows only 11 of 41 mining companies to continue operating
Manila: President Rodrigo Duterte wants a pro-Philippine mining law after the environment department has closed 30 mining firms and allowed 11 of 41 mining companies to continue operating while undergoing audit on minor environment infraction, sources said.
“Duterte has called for the amendment of the Mining Act of 1995, to include a 60-40 per cent profit sharing between the Philippine government and foreign mining firms with mining permits,” geologist Rolando Pena told Gulf News, adding it was patterned after the production-sharing agreements reached by the Philippine government and oil firms allowed to explore oil in the Philippines.
Duterte also wanted taxes higher than the existing 2 per cent of gross for metallic and non-metallic minerals extracted in the Philippines, said Pena.
“Duterte is planning to nationalise the mining industry and has promised to push for the passage of the People’s Mining Bill of 2013,” said Congressman Carlos Zarate of Bayan, a sectoral party at the House of Representatives.
The Mining Act of 1995 allows foreign ownership of mining assets and exploration permits, a provision upheld by the Supreme Court as Constitutional in 2004.
The closure of 30 mining firms because of infractions in environment protection after an audit that began in July was the recent squeeze on the mining industry.
On September 27, the environment department asked 20 mining firms to stop operating unless their proposed rectifications to protect the environment are approved for a final review in early October. They accounted for 18 million tonnes of ore, or 55.5 per cent of the country’s nickel production.
Last July, the environment department initially closed 10 mining firms which represented 10 to 12 per cent of the country’s mineral production.
The 11 mining firms that were allowed to operate represent 25 per cent of the world’s total nickel production.
Initial squeezes on the mining industry already began in 2010, when former President Benigno Aquino issued an Executive Order that banned the issuance of new mining permits. It affected 1,828 mining applications at the time.
Aquino also called for 5 per cent royalty tax for mining permits in mining reservations, increased filing fee charges; and synchronised local and national regulations of the mining industry. Congress did not pass laws to implement these proposals.
About 30 million hectares of land in the Philippines has an estimated $1.4 trillion (an earlier estimate was $840 billion) worth of reserves in aluminium, chromite, copper, and gold. Metal deposit is estimated at 21.5 billion metric tonnes; non-metallic deposits, 19.3 billion metric tonnes.
About 999 approved mining applications cover only one million hectares of lands.
Philippine minerals exported to Australia, Canada, China, Japan, Korea, Malaysia, United States, and the United Kingdom earned $3.2 billion in 2010, $4 billion in 2015.