Leo Jasareno presentation at Conference on Mining's Impact on Philippine Economy and Ecology
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The Conference on Mining's Impact on Philippine Economy and Ecology, March 2, 2012, Inter-Continental Manila Engr. Leo Jasareno of the Mines and GeoSciences Bureau and the Department of Environment and Natural Resources presented the government's perspective.
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Leo Jasareno presentation at Conference on Mining's Impact on Philippine Economy and Ecology
- 1. MINING’S IMPACT ON THE PHILIPPINE ECONOMY AND ECOLOGY: GOVERNMENT PERSPECTIVE LEO L. JASARENO Acting Director Mines and Geosciences Bureau Department of Environment and Natural Resources
- 2. Shall we mine or not?
- 3. “The Philippines possesses a strong mineral resource base that justifies mining as a development option - for as long as it is responsible mining where benefits far outweigh the costs.” From: Garwin
- 4. THE LEGAL BASIS OF MINING •Section 2, Article XII of the 1987 Philippine Constitution “The exploration, development, and utilization of natural resources shall be under the full control and supervision of the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least 60 per centum of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and under such terms and conditions as may provided by law”. “The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other mineral oils according to the general terms and conditions provided by law, based on real contributions to the economic growth and general welfare of the country. In such agreements, the State shall promote the development and use of local scientific and technical resources.” •Section 2 of the Philippine Mining Act of 1995 “All mineral resources in public and private lands within the territory and exclusive economic zone of the Republic of the Philippines are owned by the State. It shall be the responsibility of the State to promote their rational exploration, development, utilization and conservation through the combined efforts of government and the private sector in order to enhance national growth in a way that effectively safeguards the environment and protect the rights of affected communities”.
- 5. Philippine Mining Act and IRR • Enshrined the principles of responsible mining; • Placed strong focus on life-of- mine and after-mining environmental and social responsibilities; • Ensured equitable sharing of benefits; and • Protected the rights of Indigenous Peoples and
- 6. Other Major Laws on Mining • National Integrated Protected Areas System Act • Indigenous Peoples Rights Act • Environmental Laws • Philippine EIS System • Clean Water Act • Clean Air Act • Ecological Solid Wastes Management Act • Hazardous and Toxic Wastes Management Act • Local Government Code • Forestry Code • Small-Scale Mining Laws
- 7. Mining is NOT allowed in: • Old growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, mossy forests, national parks, provincial/municipal forests, tree parks, greenbelts, game refuge, bird sanctuaries and areas proclaimed as marine reserves/marine parks, tourist zones, and identified initial components of the NIPAS; • Critical watersheds with appropriate barangay/municipal/ city/provincial Sanggunian ordinance; • Forest and other government reservations (unless with clearance from agency concerned); • Built-up areas (buildings, bridges, private plantations, etc.) unless with consent from agency or party concerned; • Ancestral domains/lands unless with Free and Prior Informed Consent from Indigenous Peoples; • Coastal areas; and • Other areas expressly prohibited by law.
- 8. THE LEGACY MINES Rallying point of those who oppose new mining projects
- 9. FINAL MINE REHABILITATION/DECOMMISSIONING PLAN Year 0: Mined-Out Area
- 10. Year 2
- 11. Year 3
- 12. Year 4
- 13. Approved Mining Tenements (As of January 2012) Exploration Permit 115 Mineral Production Sharing Agreement 339 Financial or Technical Assistance Agreement 6 Mineral Processing Permit 68 Industrial Sand and Gravel Permit 214 Mining Lease Contract 36 TOTAL EXISTING/APPROVED MINING PERMITS 778
- 14. Operating Mines • 3 Copper mines (with gold and silver) • 1 Copper mine (with gold, silver zinc) • 5 Gold mines • 3 Chromite mines • 1 Magnetite mine • 18 Nickel mines • 1 Nickel Processing Plant • 1 Copper Processing Plant • 2000+ sand and gravel, and other non-metallic small-scale operations
- 15. Mine Development Far Southeast Copper- Gold Project Projects OceanaGold Didipio Copper-Gold Project Siana Gold Project Boyungan Runruno Gold- Gold Project Molybdenum Project Sumitomo Kingking Copper Gold Nickel Project Project Tampakan Copper Project
- 16. Industry Performance 2009 2010 2011* GROSS PRODUCTION VALUE IN MINING (MGB) Large Scale Metallic Mining P 42.8 Billion P 68.2 Billion P 88.0 Billion Small Scale Gold Mining 36.8 Billion 42.9 Billion 34.1 Billion Non-metallic mining 26.5 Billion 33.3 Billion nya TOTAL P 106.1 Billion P144 .4 Billion P122.1 Billion GROSS VALUE ADDED IN MINING AT CURRENT PRICES P 65.8 Billion P 88.2 Billion P 56.1 Billion* (NSCB) Mining Contribution To GDP 0.8% 1.0% 1.2% TOTAL EXPORTS OF MINERALS & MINERAL PRODUCTS (BSP) $1,470 Million $1,870 Million $2,043 Million Mining Contribution To Total Exports 3.9% 3.7% 5.6% TOTAL EXPORTS OF NON-MET. MINERAL MANUFACTURES $156 Million $162 Million $130 Million (BSP) Mining Contribution To Total Exports 0.4% 0.3% 0.4% EMPLOYMENT IN MINING AND QUARRYING (DOLE) 169,000 197,000 205,000 Mining Contribution To Total Employment 0.5% 0.5% 0.6% TAXES, FEES AND ROYALTIES FROM MINING Fees, Charges & Royalties Collected by DENR-MGB/LGUs P 396.2 Million P 800.6 Million P 558.6 Million Excise Tax Collected by BIR 718.8 Million 1,299.7 Million nya Taxes Collected by Nat'l. Gov't. Agencies 10,272.5 Million 10,612.4 Million nya Taxes and Fees Collected by LGUs 992.8 Million 1,113.0 Million 23.0 Million TOTAL P12,380.3 Million P13,825.7 Million P581.6 Million * - Preliminary
- 17. Industry Performance 2011 2010 % Change Mineral Commodity Unit Quantity Value Quantity Value Qty Value PRECIOUS METALS 65,898,447,124 71,698,391,862 -8 Gold kg 31,120 63,142,761,963 40,847 70,508,198,235 -24 -10 Silver kg 45,530 2,755,685,161 41,004 1,190,193,627 11 132 BASE METALS 56,248,482,781 40,271,604,780 40 Copper Concentrate DMT 253,975 19,091,584,582 236,814 15,775,710,591 7 21 Nickel Concentrate DMT 38,798 11,197,108,000 33,539 9,795,473,000 16 14 Nickel Direct Shipping Ore DMT 20,104,142 24,463,091,114 13,763,734 14,080,650,478 46 74 Metallurgical Chromite DMT 25,483 145,178,018 14,807 117,135,758 72 24 Zinc DMT 37,354 1,036,557,037 19,819 502,634,953 88 106 Iron Ore DMT 126,177 314,964,029 0 0 TOTAL 122,146,929,90 111,969,996,642 9 5
- 18. PH now 2nd in global mine production after Russia (United States Geological Survey Mineral Commodity Summaries 2012)
- 19. CHALLENGES • Perception of mining as an environmental despoiler; • Lapses and delinquencies of miners; • Lack of monitoring capability of government; • Insufficient national mineral resources inventory; • Insufficient Government Share from mineral resources utilization; • Security of investments; and • Opposition of LGUs to mining.
- 20. CHALLENGES • Small-Scale mining: • Having 2 laws on small-scale mining; • The unabated use of mercury in extracting gold; • Unsafe mining practices; • Lack of environmental impact mitigation; • Rampant child labor; • Illegal use of heavy equipment and explosives; • Non-collection of excise tax; • Rapid depletion of mineral deposits due to selective unsystematic method of mining; and • Proliferation of illegal small-scale mining operations.
- 21. CHALLENGES • Land Use Conflicts with - • Farmlands. • Ancestral land/domain. • Key biodiversity areas. • Proposed protected areas. • Eco-tourism areas. • Agrarian reform areas. • Forestry projects. • Fishing grounds.
- 22. The Road Forward • Pursuing further the “Use it or Lose it Policy”; • Enrolling the mining industry in the National Greening Program; • Participating in the Extractive Industry Transparency Initiative; • Responding to the legislative challenges to the Mining Act;
- 23. The Road Forward • Pursuing the early resolution of cases filed against mining projects, such as the petitions for Writ of Kalikasan and Temporary Environmental Protection Order; • Intensifying information, education and communication campaign.
- 24. Mining Policy of the Aquino Administration
- 25. THANK YOU ! www.MGB.gov. ph
- 26. Siltation: From the mine or not?
- 27. A mining area situated right along a road and the coast, with vulnerable features.
Editor's Notes
- SHALL WE MINE OR NOT? AND THE PHILIPPINE GOVERNMENT, EVER SINCE, HAS DECIDED THAT IT HAS TO PURSUE MINING. THERE ARE A NUMBER OF REASONS WHY. BUT ESSENTIALLY, THIS IS BECAUSE OF THE COUNTRY’S RESOURCE BASE.
- THE PHILIPPINES IS SITUATED ALONG THE PACIFIC RIM OF FIRE THAT EXTENDS FROM THE TIP OF SOUTH AMERICA, TO NORTH AMERICA, EAST ASIA AND OCEANIA. THIS IS A BELT OF VOLCANOES AND AN EXTENSIVE AND CONTINUOUS ZONE OF COLLIDING TECTONIC PLATES. ON ONE HAND, THIS HAS BROUGHT TO THE COUNTRY DEVASTATING NATURAL HAZARDS… AND ON THE OTHER HAND, THIS HAS RESULTED IN THE FORMATION OF ABUNDANT MINERAL DEPOSITS OF GOLD, COPPER, IRON, CHROMITE, NICKEL, COBALT AND PLATINUM, AMONG OTHERS. THE AREAS DEFINING THIS BELT ARE THE PRIMARY PRODUCERS OF COPPER AND GOLD IN THE WORLD TODAY. GOVERNMENT IS AWARE THAT LEFT ON THE GROUND, THESE MINERALS CANNOT GENERATE WEALTH FOR FILIPINO PEOPLE. AND THE COUNTRY NEEDS WEALTH.
- THIS EXPLAINS WHY THE PURSUIT OF MINING FINDS BASIS IN THE PHILIPPINE CONSTITUTION. THE FOLLOWING PORTION OF SECTION 2, ARTICLE XII OF THE 1987 PHILIPPINE CONSTITUTION IS VERY CLEAR: “ THE STATE MAY DIRECTLY UNDERTAKE SUCH ACTIVITIES, OR IT MAY ENTER INTO CO-PRODUCTION, JOINT VENTURE OR PRODUCTION SHARING AGREEMENTS...” AND COGNIZANT OF THE VARIOUS IMPACTS OF MINING, THE PHILIPPINE MINING ACT OF 1995, THROUGH ITS DECLARATION OF POLICY, VERY CLEARLY SPELLED OUT THE “TERMS OF REFERENCE” : “ ALL MINERAL RESOURCES IN PUBLIC AND PRIVATE LANDS WITHIN THE TERRITORY AND EXCLUSIVE ECONOMIC ZONE OF THE REPUBLIC OF THE PHILIPPINES ARE OWNED BY THE STATE. IT SHALL BE THE RESPONSIBILITY OF THE STATE TO PROMOTE THEIR RATIONAL EXPLORATION, DEVELOPMENT, UTILIZATION AND CONSERVATION THROUGH THE COMBINED EFFORTS OF GOVERNMENT AND THE PRIVATE SECTOR IN ORDER TO ENHANCE NATIONAL GROWTH IN A WAY THAT EFFECTIVELY SAFEGUARDS THE ENVIRONMENT AND PROTECT THE RIGHTS OF AFFECTED COMMUNITIES”.
- IN EFFECT, THE PHILIPPINE MINING ACT, TOGETHER WITH ITS IMPLEMENTING RULES AND REGULATIONS - ENSHRINED THE PRINCIPLES OF RESPONSIBLE MINING; PLACED STRONG FOCUS ON LIFE-OF-MINE ENVIRONMENTAL AND SOCIAL RESPONSIBILITIES; ENSURED THE EQUITABLE SHARING OF BENEFITS; AND PROTECTED THE RIGHTS OF INDIGENOUS PEOPLES AND COMMUNITIES.
- IN THE PURSUIT OF MINING, THE MINING ACT DOES NOT WORK ALONE. OTHER MAJOR LAWS MUST ALSO BE FOLLOWED, SUCH AS: THE NATIONAL INTEGRATED PROTECTED AREAS SYSTEM; THE INDIGENOUS PEOPLES RIGHTS ACT; THE ENVIRONMENTAL LAWS; THE LOCAL GOVERNMENT CODE; THE FORESTRY CODE; AND THE SMALL-SCALE MINING LAWS. AND IT IS NOTEWORTHY THAT EACH OF THESE LAWS HAS ITS OWN SET OF VERY STRINGENT REQUIREMENTS, TO ENSURE THAT AN EXTRACTIVE INDUSTRY LIKE MINING IS DONE PROPERLY.
- NOT ALL AREAS ARE OPEN TO MINING. THE PHILIPPINE MINING ACT EXPRESSLY PROVIDES THAT THE FOLLOWING AREAS ARE CLOSED TO MINING: OLD GROWTH OR VIRGIN FORESTS, PROCLAIMED WATERSHED FOREST RESERVES, WILDERNESS AREAS, MANGROVE FORESTS, MOSSY FORESTS, NATIONAL PARKS, PROVINCIAL/MUNICIPAL FORESTS, TREE PARKS, GREENBELTS, GAME REFUGE, BIRD SANCTUARIES AND AREAS PROCLAIMED AS MARINE RESERVES/MARINE PARKS AND TOURIST ZONES, AND IDENTIFIED INITIAL COMPONENTS OF THE NIPAS; CRITICAL WATERSHEDS WITH APPROPRIATE BARANGAY/MUNICIPAL/ CITY/PROVINCIAL SANGGUNIAN ORDINANCE; FOREST AND OTHER GOVERNMENT RESERVATIONS (UNLESS WITH CLEARANCE FROM AGENCY CONCERNED); BUILT-UP AREAS (BUILDINGS, BRIDGES, PRIVATE PLANTATIONS, ETC.) UNLESS WITH CONSENT FROM AGENCY OR PARTY CONCERNED; ANCESTRAL DOMAINS/LANDS UNLESS WITH FREE AND PRIOR INFORMED CONSENT FROM INDIGENOUS PEOPLES; COASTAL AREAS: AND OTHER AREAS EXPRESSLY PROHIBITED BY LAW.
- ONE OF THE MOST CRITICAL PROVISIONS OF THE MINING ACT IS THE REQUIRED REHABILITATION OF THE MINED-OUT AREA. MINING OPERATIONS OF THE PAST HAVE LEFT BEHIND LEGACY MINES – MINES THAT WERE SIMPLY ABANDONED BY THE MINING OPERATORS WITHOUT DOING REHABILITATION WORKS. THEY ARE NOT JUST GAPING HOLES, BUT ALSO SOURCES OR CAUSES OF ACID MINE DRAINAGE, SILTATION, GHOST TOWNS AND OTHER NIGHTMARES TO PEOPLE OF THE HOST COMMUNITIES. THEY HAVE BECOME THE RALLYING POINT OF PEOPLE WHO OPPOSE NEW MINING PROJECTS, ON THE SIMPLE UNDERSTANDING THAT SUCH NEW MINING PROJECTS WILL END UP AS NEW LEGACY MINES.
- THE FINAL MINE REHABILITATION/DECOMMISSIONING PLAN BEING IMPOSED BY THE MINING ACT SHALL BE THE ANTIDOTE FOR THE LEGACY MINES. CRADLE TO GRAVE TO CRADLE. A FOREST AREA SHALL BE DISTURBED TO EXTRACT THE MINERALS – WHERE MINING BECOMES A TEMPORARY LAND USE – THEN AFTER MINING, THE MINED-OUT AREA SHALL BE REFORESTED TO BECOME A FOREST AGAIN. THE USE OF THE LAND IS SUSTAINED: FROM FOREST USE TO MINING USE TO FOREST USE.
- WITH THE IMPLEMENTATION OF THE MINING ACT, THERE IS NOW A TOTAL OF 778 EPS, MPSAS, FTAAS, ISGP, MPP AND MLCS AS OF JANUARY 2012, COVERING A TOTAL OF 1.14 MILLION HECTARES OR 3.8% OF THE COUNTRY’S TOTAL LAND AREA. IT HAS TO BE CLARIFIED ALWAYS, HOWEVER, THAT SUCH HECTAREAGE IS STILL SUBJECT TO RELINQUISHMENT AND WILL NOT BE TOTALLY IMPACTED BY ACTUAL MINING.
- OUT OF THE 778 MINING CONTRACTS AND PERMITS, THERE ARE THIRTY ONE OPERATING METALLIC MINES COMPRISED OF: 3 COPPER MINES (WITH GOLD AND SILVER) 1 COPPER MINE (WITH GOLD, SILVER ZINC) 5 GOLD MINES (WITH SILVER) 3 CHROMITE MINES 1 MAGNETITE MINE 18 NICKEL MINES THIS IS IN ADDITION TO - 1 NICKEL PROCESSING PLANT 1 COPPER PROCESSING PLANT 55 OPERATING NON-METALLIC MINES 2000+ SAND AND GRAVEL, AND OTHER NON-METALLIC OPERATIONS.
- THERE ARE ALSO AT LEAST EIGHT PROJECTS IN THE FEASIBILITY OR DEVELOPMENT AND CONSTRUCTION STAGE THAT WILL CONTRIBUTE TO PHILIPPINE MINERAL PRODUCTION IN 2 TO 3 YEARS.
- IN TERMS OF INDUSTRY PERFORMANCE, MINING HAS BEEN PROGRESSIVELY IMPROVING SINCE 2004. FOR 2011, THE LARGE-SCALE METALLIC MINING SECTOR POSTED A GROSS PRODUCTION VALUE OF PHP122.1 BILLION, A 9% INCREASE (OR PHP10.18 BILLION) FROM LAST YEAR’S PHP112 BILLION. THIS POSITIVE TREND WAS SET BY NEW ENTRANTS TO THE PRODUCTION STREAM, TOGETHER WITH THE FAVORABLE METAL PRICES IN THE WORLD MARKET. IT IS NOTEWORTHY THAT THE CONTRIBUTION OF MINING TO GDP HAS NOT BEEN ABLE TO BREAK THE 1.5% BARRIER FOR A LONG TIME NOW. MINING‘S CONTRIBUTION TO TOTAL EXPORTS IS ALSO SIMILARLY SITUATED.
- IN TERMS OF PERCENTAGE CONTRIBUTION TO THE OVERALL PRODUCTION VALUE, GOLD, NICKEL AND COPPER WERE THE KEY PLAYERS. GOLD TOOK THE LEAD, ACCOUNTING FOR 52%, OR PHP63.14 BILLION, OF THE TOTAL PRODUCTION VALUE. NICKEL FOLLOWED WITH 29%, OR PHP35.66 BILLION, AND COPPER WITH 16%, OR PHP19.09 BILLION. IN TERMS OF GROWTH RATES, SILVER AND ZINC SUB-SECTORS DISPLAYED THE HIGHEST IMPROVEMENTS AT 132% AND 106%, RESPECTIVELY.
- WITH EIGHTEEN NICKEL MINES, THE PHILIPPINES IS NOW 2 ND IN GLOBAL MINE PRODUCTION, BASED ON THE RECENT REPORT OF THE UNITED STATES GEOLOGICAL SURVEY. THE COUNTRY RANKED NUMBER FOUR IN 2009 AND NUMBER THREE IN 2010.
- FOR AN INDUSTRY THAT HAS BEEN HOUNDED BY ITS SINS OF THE PAST, ITS GROWTH AND SUSTAINABILITY IS THREATENED BY SERIOUS CHALLENGES, SUCH AS; PERCEPTION OF MINING AS AN ENVIRONMENTAL DESPOILER; LAPSES AND DELINQUENCIES BY MINERS; LACK OF MONITORING CAPABILITY OF GOVERNMENT; INSUFFICIENT NATIONAL MINERAL RESOURCES INVENTORY; INSUFFICIENT GOVERNMENT SHARE FROM MINERAL RESOURCES UTILIZATION; SECURITY OF INVESTMENTS; AND OPPOSITION OF LGUS TO MINING.
- THERE IS ALSO THE ISSUE OF SMALL-SCALE MINING: HAVING 2 LAWS ON SMALL-SCALE MINING; THE UNABATED USE OF MERCURY IN EXTRACTING GOLD; UNSAFE MINING PRACTICES; LACK OF ENVIRONMENTAL IMPACT MITIGATION; RAMPANT CHILD LABOR; ILLEGAL USE OF HEAVY EQUIPMENT AND EXPLOSIVES; NON-COLLECTION OF EXCISE TAX; RAPID DEPLETION OF MINERAL DEPOSITS DUE TO SELECTIVE UNSYSTEMATIC METHOD OF MINING; AND PROLIFERATION OF ILLEGAL SMALL-SCALE MINING OPERATIONS.
- … LAND USE CONFLICTS… FARMLANDS ANCESTRAL LAND/DOMAIN KEY BIODIVERSITY AREAS PROPOSED PROTECTED AREAS ECO-TOURISM AREAS AGRARIAN REFORM AREAS FORESTRY PROJECTS FISHING GROUNDS
- IN RESPONSE TO THESE CHALLENGES, THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES HAS PURSUED VARIOUS POLICY REFORMS, SUCH AS: THE “USE IT OR LOSE IT POLICY”; ENROLLING THE MINING INDUSTRY IN THE NATIONAL GREENING PROGRAM; PARTICIPATING IN INITIATIVES LEADING TO THE COUNTRY’S SIGN-IN TO THE EXTRACTIVE INDUSTRY TRANSPARENCY INITIATIVE; RESPONDING TO THE LEGISLATIVE CHALLENGES TO THE MINING ACT;
- PURSUING THE EARLY RESOLUTION OF CASES FILED AGAINST MINING PROJECTS, SUCH AS THE PETITIONS FOR WRIT OF KALIKASAN AND TEMPORARY ENVIRONMENTAL PROTECTION ORDER; AND INTENSIFYING INFORMATION, EDUCATION AND COMMUNICATION CAMPAIGN.
- STILL, THE CHALLENGES REMAIN. THE PHILIPPINE GOVERNMENT IS VERY MUCH AWARE THAT MANY ISSUES CONTINUE TO CONFRONT THE MINING INDUSTRY; ISSUES THAT ARE EVEN THREATENING ITS EXISTENCE AS A DEVELOPMENT OPTION. THIS IS THE MAIN REASON WHY A MINING STUDY GROUP WAS CREATED AND TASKED TO FORMULATE THE MINING POLICY OF THE ADMINISTRATION, WHICH WOULD ADDRESS THE ENVIRONMENTAL AND SOCIAL ISSUES, AND COME UP WITH A SOCIALLY ACCEPTABLE MINING INDUSTRY IN THE COUNTRY. IN THE END, IT SHOULD BE MINING THAT SIGNIFICANTLY CONTRIBUTES TO ECONOMIC GROWTH IN A MANNER THAT MITIGATES THE IMPACTS ON THE ENVIRONMENT AND IMPROVES THE QUALITY OF LIFE OF THE PEOPLE - - - OR NOT AT ALL.
- THANK YOU