3. BASAY MINING CORPORATION
Location: • Sitio Muhong, Brgy. Maglinao, Basay, Negros Oriental
Asset Description: • 1,289 mining claims
Mining Claims transferred by BMC to PNB
Item No. of Claims Area In accordance with
1 1,090 6,246 DOA dated 03 May 1977
2 152 12,794 DOA dated 01 March 1984
3 47 3,564 DOA dated 02 March 1984
TOTAL 1,289 22,604
Transfer Price:
Area Coverage: • Basay, Negros Oriental; Sipalay, Negros Occidental; Hinobaan,
Negros Occidental; Cauayan, Negros Occidental; Bayawan, Negros
Oriental; Ilog, Negros Occidental; Palauig, Zambales and Kalinga,
Apayao
• 38,219 hectares
Operational History: • The Basay Mining Corporation (BMC), formerly CDCP Mining
Corporation (CDCPM) was established in 1970. BMC entered into
several Mining Agreements to mine, operate and develop
approximately 1,089 mining rights in several municipalities of Basay,
Negros Oriental.
• Thereafter, BMC/CDCP entered into Deed of Assignment of Mining
Claims and Leasehold Rights with Philippine National Bank (PNB),
thereby assigning the said mining rights, various real properties and
chattel mortgages to secure credit and loan accommodations on 3
May 1977.
• The mining operation was suspended on 30 June 1983 due to lack of
working and operating funds of BMC.
GFI Transfer Price
DBP 49,231,000.00
PNB 947,301,960.00
Total Php 996,532,960.00
4. BASAY MINING CORPORATION
Status: • BMC is abandoned and no longer operating.
• PMO provided caretakers and security guards to the said property to
prevent intrusions and entry of parties pulling out mineral ores
without clearance from PMO.
• The Ausejo lot in Cot-cot, Basay is currently occupied by informal
settlers. In the latest inspection report of MDII, there are fifteen
(15) families in the said area.
• PMO has procured Financial and Technical Advisor to provide the
economic, technical, financial, social and environmental study; To
give a market valuation of the property; To evaluate the mining
tenement and determine the viability for reopening the mine site;
To establish a social baseline and environmental baseline report;
and to make a comprehensive privatization plan for the mining
assets (Basay Mining Corporation and Marinduque Mining and
Industrial Corp. (MMIC)).
Mine Site
5. MARINDUQUE MINING & INDUSTRIAL
CORPORATION (BAGACAY)
Asset Description: • The assets of the MMIC were foreclosed by the Development Bank of
the Philippines (DBP) and the Philippine National Bank (PNB) on
December 31, 1984 with an outstanding claim of P19.453 billion. The
assets were transferred to APT for privatization.
• The only remaining assets are thirty two (32) Mining Claims, in
Bagacay, Hinabangan Western Samar with a total land area of 2,592
hectares, cottage 54 and elevated water tank. The rest were already
disposed through bidding in 1991, 2000 and 2001 to several bidders in
a total of P21,750,260.00.
GFI:
Transfer Price:
• DBP/PNB
• ₱7,036,990,070.00 as of June 30, 1986
Operational History: • Bagacay Mines was originally discovered in 1954 as a copper orebody
by the then Marinduque Mining & Industrial Corporation (MMIC). The
actual production started in 1957 for 20 years. From then on, the
copper mine produced 133,933 metric tons of copper metal, 1,126
kilograms of gold and 75, 318 kilograms of silver. Bagacay was
foreclosed by the DBP and PNB in 1984.
• Bagacay Mines is composed of 32 mineral claims located at Bagacay,
Hinabangan, Western Samar. It is comprised of a total area of 2,592
hectares. This area’s mineral claims are covered under the Mineral
Production Sharing Agreement (MPSA), proposed filed with the
Department of Environment and Natural Resources (DENR), Region
VIII, Tacloban City on July 5, 1991.
6. MARINDUQUE MINING & INDUSTRIAL
CORPORATION (BAGACAY)
Operational History: • On May 25, 1984, Philippine Phosphate Fertilizer Corporation (Philphos) and its subsidiary, Philippine Pyrite Corporation (PPC)
was granted by MMIC the right to develop and exploit the pyrite deposits of Bagacay in 1989, the APT granted Philphos/PPC a
similar right. However, on July 31, 1993, Philhos/PPC ceased its operations at the Bagacay Mines and consequently pulled out
most of its machinery an equipment, transferring the same to its fertilizer plant in Isabela.
• MMIC is the primary producer of nickel, copper and cement in the Philippines.
• To finance its operations, MMIC availed of several loans from the PNB. The loans were secured by several mortgages on
buildings, improvements, machineries and equipment, service vehicles and spare parts including the mining rights, composed
of thirty two (32) mineral claims located at Bagacay, Hinabangan Western Samar, with a total land area of 2,592 hectares.
• The real estate properties of the MMIC listed and described in the Sheriff’s Certificate of Sale dated August 31, 1984 were
acquired by the Development Bank of the Philippines (DBP) and the Philippine National Bank (PNB) through a foreclosure sale.
These properties were subsequently transferred to Maricalum Mining Corporation (MMC), a mining company formed and
organized by PNB and DBP in accordance with law purposely to own, manage, and operate the subject foreclosed properties.
• The assets consisting of improvements, facilities, machinery and equipment thereon were transferred to APT for privatization
pursuant to Proclamation No. 50 dated December 8, 1986 at a Transfer Price of ₱7,036,990,070.00 as of June 30, 1986, details
as follows:
• On December 6, 2000, then President Estrada signed Executive Order No. 323, which created among others, the Privatization
and Management Office (PMO), as successor agency of APT and transferred the remaining physical assets managed by APT for
NG to PMO for disposition, including MMIC-Bagacay Mines assets.
Loan ₱ 52,910,430.00
Acquired Assets 64,936,782,860.00
Accrued Interest Receivable 432,891,320.00
Others 57,405,460.00
TOTAL ₱ 7,036,990,070.00
7. MARINDUQUE MINING & INDUSTRIAL
CORPORATION (BAGACAY)
Recoveries: • Hereunder are the recoveries from MMIC-Bagacay
Mines asset totaling ₱21,891,010.00, broken down as
follows:
• The only remaining assets of MMIC are 32 mineral
claims, cottage 54 and an elevated water tank.
Mine Site
Buyer Amount
Abellar Metal Craft ₱ 3,240,000.00
Leonardo Lopez 6,000.00
Jerry Yamson 140,850.00
Mateo S. Biong 250,000.00
Aboytes Ent. & MZQ 9,789,410.00
E.C. de Luna Const. 183,750.00
Jabel Corporation 8,281,000.00
₱ 21,891,010.00
8. MARICALUM MINING CORPORATION
Asset Description: • Financial claims of Php241,702,122.86
GFI: • DBP
Transfer Price: • Php2,479,333,000
History of claims: • G Holdings, Inc. (GHI) - ₱241,702,122.86 – representing unpaid balance of the purchase price of
4,500,000 shares of stock and company notes of Maricalum Mining Corporation (MMC) sold by APT to
GHI.
• On October 2, 1992, a Purchase and Sale Agreement (PSA) was entered into by and between the
Republic of the Philippines through the APT and the GHI, a stock corporation registered with the
Securities and Exchange Commission, for the disposition of MMC, a transferred asset from the DBP
and PNB.
• Under the Agreement, APT undertook deliver the following to GHI in consideration of the total
purchase price of ₱673,161,280.00:
1. 90% of the entire issued and outstanding shares of MMC
with a par value of ₱4,500,000.00; and,
2. Company Notes amounting to ₱3,258,771,000.00.
9. MARICALUM MINING CORPORATION
History of claims: • The PSA also provided for a downpayment of ₱98,704,000.00, the balance of ₱574,457,280.00 to be divided into four
tranches payable in installment over a period of ten (10) years.
• Immediately upon the signing of the PSA, and upon satisfaction of the stipulated downpayment, GHI was allowed to take
physical possession of the mine site and related facilities, including full control of the management and operations of the
MMC.
• On April 6, 1993, GHI paid the 1st installment amounting to ₱2,467,600.00.
• GHI filed a case for specific performance and damages with the Regional Trial Court (RTC) Manila due to conflicting
interpretations of the reckoning date of payment of the balance of the purchase price and APT’s threat to rescind the
contract.
• The RTC Decision dated June 11, 1996 ordered the APT to execute the corresponding document of transfer and cause the
actual delivery of subject shares and notes to GHI within a period of thirty (30) days from receipt of the Decision after the
GHI shall have paid in full the entire balance at its present value of ₱241,702,122.86, computed pursuant to the
prepayment provisions of the Agreement. GHI shall pay the balance simultaneously with the delivery of the Deed of
Transfer and actual delivery of the shares and notes.
• On appeal up to the Supreme Court, the RTC’s decision was affirmed in its Notice of Judgment dated November 22, 2005.
Consequently, the account balance was adjusted to ₱241,702,122.86.
• On April 20, 2010, PMO manifested before the RTC that it is ready to comply with the execution of the Document of
Transfer. GHI, for its part, should show its willingness and capability to pay the entire balance of the purchase price
amounting to ₱241,702,122.86.
• In an Order dated July 19, 2010, the RTC mandated PMO and GHI to appoint their respective representatives to meet,
confer, and discuss any and all pending matters, issues and items of the transaction for the finalization and execution of
the pertinent closing documents.
• The PMO is exploring possible legal actions/options regarding the account.
10. NONOC MINING & INDUSTRIAL
CORPORATION
Location: • Cadianao, Surigao del Norte. Nonoc Island lies about 15kms to
the northeast of Surigao City.
GFI:
Transfer Price:
Area Coverage: • The areas covered at present by the Mineral Production and
Sharing Agreement (MPSA) approved on September 2, 1996, are
as follows:
Brief Background: • Nonoc Mining and Industrial Corporation (NMIC) was
incorporated by the Philippine National Bank (PNB) and
Development Bank of the Philippines (DBP) as the assignee of all
the foreclosed mining assets (i.e., Nickel Refinery Plant, buildings
and equipment, and mining rights over the Nonoc Mining Area) of
Marinduque Mining and Industrial Corporation. In 1986, pursuant
to Proclamation No. 50 issued by President Corazon C. Aquino,
PNB and DBP transferred all its shares in NMIC to the APT for
privatization and disposition
Nonoc Island 4,372 hectares
South Dinagat Island 8,736
Awasan 916
Hanigad 976
Total 25,000 hectares
Particulars DBP PNB
Loan ₱ 12,150,597,000.00 ₱ 496,704,510.00
Equity ₱ 14,250,000.00 ₱ 10,750,000.00
Other
Receivables ₱ 7,294,000.00 -
Total ₱ 12,172,141,000.00 ₱ 507,454,510.00
11. NONOC MINING & INDUSTRIAL
CORPORATION
APT Disposition of Shares in NMIC: • Philnico Mining and Industrial Corporation - ₱14,905,855,832.00 - represents peso equivalent of the unpaid balance of
US$263,762,000.00 purchase price of 22,500,000 shares of stock, representing 90% ownership, in Nonoc Mining and
Industrial Corporation (NMIC Shares), which were sold by APT to Philnico Industrial Corporation (Philnico) in 1996.
• In 1989, APT sought to privatize the NMIC Shares through a sale by public bidding, which however failed. Thereafter,
APT sought proposals for the outright purchase and/or lease with option to purchase the mining rights for the Nonoc
Mining Area. In 1990, APT entered into a Definitive Agreement with Philnico for the sale of the NMIC Shares, subject
to the condition that a Mineral Production and Sharing Agreement (MPSA) be issued to NMIC for the Nonoc Mining
Area.
• Philnico failed to comply with the conditions of the Definitive Agreement despite several extensions due to its failure
to obtain the financing needed to bring the nickel refinery back in operation. In 1995, Philnico sold all its shares in
Philnico to Pacific Nickel Holdings Limited (PNHL).
• In 1996, Philnico/PNHL negotiated with APT for the restructuring of the payment terms for the purchase of the NMIC
Shares. Thus, the Amended and Restated Definitive Agreement (ARDA) was entered into on May 10, 1996 between
APT and Philnico.
• The ARDA provides the amortization schedule for payment of the purchase price for the NMIC Shares. On September
27, 1999, the terms of payment were amended through an Amendment Agreement such that: (a) the purchase price
of USD 260 million was payable in 23 semi-annual installments over a period of 15 years from 1999 (inclusive of a 3-
1/2 year grace period), with Philnico being obliged to pay only 50% of each principal installment if the average LME
price of nickel during the six-month period ending one-month prior to such installment payment date is not higher
than the Company’s cash break-even price for such period; (b) the purchase price of US$ 3.762 million was payable
in 171 monthly installments from 1996 to 2010; and (c) the advances made by APT to settle labor claims amounting
to ₱74,501,000.00, and to settle the receivables of Marc Rich and Phillip Brothers Oceanic, Inc. amounting to US$
29.77 million, were payable in semi-annual installments from 2003 to 2014. Five years into the payment schedule,
Philnico failed to pay the monthly amortizations for its purchase of the NMIC Shares.
12. NONOC MINING & INDUSTRIAL
CORPORATION
Issuance and Assignment of
the MPSA:
• In 1991, in compliance with the Definitive Agreement, NMIC applied for an MPSA with the Department of
Environment and Natural Resources (DENR). On September 2, 1996, President Fidel V. Ramos, after initial grant and
revocation of MPSA, which both occurred in 1995, through the Executive Secretary, approved the reinstatement of
the MPSA in the name of Philnico. Thus, in 1997, APT and Philnico entered into a Supplemental Agreement allowing
the assignment by Philnico of the MPSA to its subsidiary, Pacific Nickel Philippines, Inc. (PNPI). Furthermore, a
Pledge Agreement was entered into whereby Philnico pledged in favor of the Government the: (a) NMIC Shares; and
(b) 250,000 shares of stock it owned in PNPI (PNPI Shares), as security for the payment of the Purchase Price. On
August 7, 1997, the DENR approved the Amendment to Philnico’s MPSA, the Deed of Assignment of MPSA by Philnico
to PNPI, and the Mineral Processing Permit of NMIC.
Transfer of Claim to PMO: • Upon the expiration of APT’s corporate term on December 31, 2000, in accordance with Republic Act (RA) No. 7181,
as amended by RA Nos. 7661, 7886, and 8758, the claim reverted to the National Government, which assigned the
same for disposition to the PMO.
• On September 14, 2016, the Regional Trial Court of Makati issued an Order in relation to the complaint filed by
Philnico for Prohibition against Reversion of Shares with Prayer for Writ of Preliminary Injunction and/or Temporary
Restraining Order, Suspension of Payment and Fixing of Period of Payment, against PMO, Philnico Processing Corp.
(PPC) and the Corporate Secretary of PPC docketed as Civil Case No. 03-114, which granted the motion for summary
judgment. Philnico was directed to commence installment payments to PMO under the ARDA not later than
December 31, 2021 or after the first of the two nickel processing plant is placed under commercial operations in
accordance with the pertinent provisions of the ARDA, whichever comes earlier, and covering the following
installment payments:
(a) Resumption of the installment payments on the “smaller portion” of the purchase price under the
ARDA; and
(b) Commencement of the installment payments on the (i) “bigger portion” of the purchase price under
the ARDA in the amount of $260 Million; (ii) $29.77 Million; and (iii) the ₱74.501 Million portions.
13. NONOC MINING & INDUSTRIAL
CORPORATION
Transfer of Claim to PMO: • On October 11, 2016, PMO, through the Office of the Solicitor General (OSG), filed a notice of appeal assailing the
Order , which was denied per Notice of Judgement and Decision dated February 27, 2019. Subsequently, PMO filed
an Entry of Appearance and Motion for Reconsideration on March 28, 2019, which was again denied per CA
Resolution dated November 07, 2019.
• As of December 31, 2019, the Statement of Account of Philnico amounts to ₱14,905,855,832.00, details follow:
Particulars Due Date Peso Equivalent
Purchase Price
Shares of Common Stocks
(Note 1)
Due from Aug. 1996
to Sep. 2010 3,762,000.00
Shares of Common Stocks
(Note 2)
Due from Sep. 2003
to Sep. 2014 260,000,000.00 263,762,000.00
Less Total Payments 1,254,000.00
Balance 262,508,000.00
Add Repayment of Advances
(Note 3)
Due from Sep. 2003
to Sep. 2014 29,770,000.00
Total 292,278,000.00 14,831,354,832.00
Add Advances (Note 4) Due from Sep. 2003
to Sep. 2014 74,501,000.00
TOTAL 14,905,855,832.00
In US Dollar
Note: US dollar was converted using BSP Average Rate of US$ 1.00 : ₱ 50.744 as of Dec. 27, 2019
14. NONOC MINING & INDUSTRIAL
CORPORATION
Particulars Due Date Peso Equivalent
Purchase Price
Shares of Common Stocks
(Note 1)
Due from Aug. 1996
to Sep. 2010 3,762,000.00
Shares of Common Stocks
(Note 2)
Due from Sep. 2003
to Sep. 2014 260,000,000.00 263,762,000.00
Less Total Payments 1,254,000.00
Balance 262,508,000.00
Add Repayment of Advances
(Note 3)
Due from Sep. 2003
to Sep. 2014 29,770,000.00
Total 292,278,000.00 14,831,354,832.00
Add Advances (Note 4) Due from Sep. 2003
to Sep. 2014 74,501,000.00
TOTAL 14,905,855,832.00
In US Dollar Note 1 - Represents sales price for the 22,500,000 shares of
Common Stock of NMIC, payable in 171 monthly installments.
The 1st installment to begin 9 months from the date of the Final
notice as defined in the ARDA (i.e., Nov. 29, 1995) or on August
29, 1996.
Note 2 - Represents sales price for the 22,500,000 shares of
Common Stock of NMIC (in addition to Note 1), payable in 23
successive semi- annual installments to begin 3 1/2 years from
the date of Amendment Agreement (AA) (i.e., September 27,
1999) or on September 27, 2003 as per Annex B of the AA.
Note 3 - Represents advances made by APT for the settlement of
the receivables of Marc Rich and Philip Brother Oceanic, Inc. from
NMIC, payable in 23 successive semi- annual installment to begin
3 1/2 years from the date of Amendment Agreement (AA) (i.e.,
September 27, 1999), or on September 27, 2003 as per Annex C
of the AA.
Note 4 - Represents advances made by APT for the settlement of
labor claims against NMIC's assets, payable in 23 successive
semi-annual installments to begin 3 1/2 years from the date of
Amendment Agreement (AA) (i.e., September 27, 1999) or on
September 27, 2003 as per Annex D of the AA.
Note: US dollar was converted using BSP Average Rate of US$ 1.00 : ₱ 50.744 as of Dec.
27, 2019
16. NORTH DAVAO MINING PROPERTY
Asset Description: 20,327 hectares located in CompostellaValley
17 April 2006 –Transfer of the Property to the Philippine Mining and Development Corporation
(PMDC), asTrustee, for development and/or disposition
14 January 2009 – Creation of North DavaoWorking Committee, composed of the representatives
from the NDC, DOF, and the President of the PMDC
Committee proposed that the development of the Property through a Joint OperatingAgreement (JOA)
Terms of Reference for the NDMP Bid:
Commitment Fee
USD2,000,000 (minimum) upon signing of the JOA
USD1,000,000 2nd to 5th year creditable to future royalties
Royalty Share 5% of Gross Sales of gold/ NSR (Net Smelter Return) for copper
Qualification Credit line of Php300,000,000.00
Selection Criterion Highest offer of commitment fee upon signing of the JOA
17. NORTH DAVAO MINING PROPERTY
06 November 2009 – Notice ofAward of the NDMP to Asia- Alliance Mining
Resources Corporation (AARMC)
13January 2010 – PMDC notified AAMRC of PrC’s approval of the Award and
gave AAMRC ten (10) calendar days to pay the commitment fee of USD28.5
Million, submit its Performance Bond, and execute the JOA
01 February 2010 – AAMRC was declared in default for failure to comply with the
conditions of the Notice ofAward
08 February 2010 – PMDC forfeited the Bidder’s Bond posted by AAMRC in the
aggregate amount of Php70 Million
18. NORTH DAVAO MINING PROPERTY
04 February 2010 – AAMRC filed a case against PMDC for specific performance,
injunction, and damages with prayer for temporary restraining order to prevent PMDC
enjoining PMDC:
(1) to award the contract for NDMP to another bidder or conduct another bidding;
(2) committing any act giving effect to PMDC’s declaration of AAMRC’s default including
calling or forfeiting the bid bond ofAAMRC; and
(3) committing any act which will disturb the status quo prior to the case
25 March 2014 – AAMRC submitted to PMDC a proposed Compromise Agreement
04 February 2020 – PMDC Board authorized Management to enter into a Compromise
Agreement with AAMRC
19. NORTH DAVAO MINING PROPERTY
PMDC Letter to PrC dated 04 June 2020:
Recommending approval by the PrC of the Compromise Agreement, which has the following
salient features:
AAMRC remittance to PMDC of USD$8,550,000 (30% of the Commitment Fee)
AAMRC opening and maintaining an escrow deposit of USD$19,950,000 (70% of the Commitment Fee,
withdrawable as follows:
Amount (in USD$) Triggering Event
8,550,000.00 Approval by the PrC of the Compromise Agreement
5,700,000.00 CA Resolution granting approval of Compromise Agreement
2,850,000.00 Registration of the JOA with the MGB Region XI
2,850,000.00 Favorable indorsement by the PMDC to the MGB/DENR of the Deed
of Assignment of the FTAA Application in favor of the AAMRC
20. NORTH DAVAO MINING PROPERTY
Commitment Fee remittances creditable to PMDC’s future share of royalties
JOA to state fixed Royalty Fee of PMDC at the rate of 5% of the gross sales of the
mineral products or the Net Smelter Return
Royalty Fee shall be in addition to any and all taxes, fees, or burdens imposed by the
Government
PMDC to provide assistance toAAMRC in obtaining necessary Government
licenses, at the expense ofAAMRC
To the extent permitted under existing DENR/MGB rules and regulations,
exploration by AAMRC shall be allowed even before FTAA is secured by AAMRC
