Who Profits From Mining in the Philippines?


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Who Profits From Mining in the Philippines

Charles Avila

Asian Magazine For Human Development
Vo.. 45 No. 11, November 2011

Published in: Technology, Business
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  • NO TO MINING IN PALAWAN and other Key Biodiversity Areas, Natural Forests, Island Ecosystems, Critical Watersheds and Agricultural Areas!
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  • Ang yaman ng Palawan ay yaman ng Pilipinas It is known as the Philippines’ Last Ecological Frontier. It has 40% of our country’s remaining mangrove areas, 30% of our coral reefs, at least 17 Key Biodiversity Areas (KBAs), 2 UNESCO World Heritage Sites, and 8 declared Protected Areas (PAs). It is unmatched anywhere in the country
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Who Profits From Mining in the Philippines?

  1. 1. Vol. 45 No. 11 • November 2011 Php 70.00
  2. 2. COVERS TO RYBy Charles AvilaF or many years now a profound cleavage has obtained in the Philip-pine State intensely dividingChurch and Government onmining issues. Here are veryhigh stakes in health and wealthand life and in the corruptionof governance—for which rea-sons the divide between thetwo, Church and government,only gets deeper and nastier. Yes, government—from who profitsthe Congress that gave us theMining Act to the ExecutiveBranch that so eagerly imple-ments it and the Judiciary thatas brazenly upheld it—forms in the phione side of the divide. Princi-pally active on this side is theChamber of Mines—a power-house of some thirty-six miningcompanies as regular members,six non-metallic explorationcompanies as associate mem-bers, forty-three equipmentmanufacturers and supply com-panies together with top-notch The Philippines has become such alegal firms as special members, the Filipino people have been sofour associations as affiliatemembers and three profes- The government concedes to thesional societies as professionalmembers. And many of them, for free its beneficial ownershneedless to say, are stronglyunited with big global foreigncorporations. This hardcore is nowdecoratively surrounded by asoftcore of NGO support in theform of the Philippine Businessfor Social Progress (PBSP) andalso—believe this or not—theWorld Wildlife Fund (WWF). What, you may ask, arethese two doing on this sideof the divide? The PBSP saystheir linkage with the Chamberis aimed at ensuring that “acollective industry program One wonders if they were ment Programs (SDMP). The the cleavage.on reforestation and … com- not quite impressed or even press release came out only daysmunity development should instrumental with a mining after the mining conference. 3 Ethical issuesbe monitored annually through group in Palawan claiming to The electric word is Palawan, The other side is thea Scorecard.”1 Proudly they have exceeded by 100 percent just like Rapu-Rapu was earlier. Church. Define her in any wayaffirm that “in the battle of the its compliance with the rules The “No to Mining in Palawan” you want: as a single institutionmedia, the PBSP can provide of the Philippine Mining Act movement is considered by the or as churches, as religiouslya softer image of the mining that only requires (in Sec. 16) Chamber at the top of their list motivated change makers inindustry.” 2 Likewise, the WWF the donation of one percent of a of “road blocks against min- civil society or in ecclesialis on this side in order to watch companys gross output for So- ing”.4 communities,—when it comesthe Chamber more closely. cial Development and Manage- Okay, that is one side of to the issue of mining, this 16 IMPACT • November 2011
  3. 3. COVER S TO RY and Eastern Church leaders denounced Roman law, no less, as immoral in its idea and practice of the absolute ownership of Earth by a few for the benefit of a few at the cost of nature’s destruction, in violation of the integrity of creation and the intention of the Creator. 5 The early Christian philos- ophers led by Saint Ambrose, quondam Governor and later Bishop of Milan, Italy warned the “capitalists” of his time that mining should, first of all, from mining follow the “tantum…quantum” (so much…as much) principle, formulated a couple hundred years earlier by Clement of Alexandria in the Catecheticalilippines? schools of that city in Egypt: mine only what you need of the earth’s finite non-renewable wealth. There ought to be, as always, a proportionality of means and ends. Government resolve give-away country—the State and But going back to the first side to hear out its urgencies: remiss in their duty as stewards. we hear and agree that the Philippines is a part of earth e foreign corporation practically that is so incredibly rich in gold, silver, copper, nickel,hip over the mineral resources. chrome and zinc that there is now a consensus among governments and industry in the valuation of the mineral wealth within the territorial limits of the Philippines at more than a trillion dollars’ Photo courtesy of Philippine Misereor Partnership worth, at least; that our country has more than seven billion metric tons (BMT) of metallic mineral reserves and 51 BMT of non-metallic deposits; that it has the fifth largest mineral resources in the world. So, this side asks: “what are we waiting for? We must lure Church is, today, one —and whole thing was not legal and wrong—not only describing those big investors in.” quite tenaciously growing in not constitutional. However, what is, but prescribing what Leading in the charge unity for a cause they consider it changed its mind in record ought to be. And it has come to is the government’s DENR transcendent of all administra- time: now everything is legal, this—that, in the area of min- Secretary who intoned, “the tions and legislation. and constitutional. After all, ing, what the Government calls Philippine government shall: Government says that the Supreme Court is supreme legal, the Church denounces as protect mining investments what they do, what they pro- and, right or wrong, the law is immoral. and remove all interferences pose, what they advocate in the whatever that Court says it is. We have here a situation to mining projects [italics area of mining—are all legal. Unfazed, the Church, on reminiscent of the early Chris- supplied]. National and local At one time the Supreme Court the other side, talks of morality, tian era during the late Roman policies affecting mining are declared otherwise, viz. that the of ethics, of what is right and Empire when both Western being harmonized toward a Volume 45 • Number 11 17
  4. 4. COVERS TO RY Photo courtesy of Philippine Misereor Partnershipfriendlier regime for the mining industry. As a case in point,” geared to addressing the need of our national economy to makingthe Secretary spoke rather boldly, “the government commits to a successful leap to becoming a strong industrial state?”pursue the [highly controversial] Tampakan project and resolve And most urgently: “Should mining projects that cannotall attendant issues prior to its implementation, even if it decides absorb the environmental and social costs of modern mining beto advance its timetable from 2016 to 2013, which we seriously allowed to proceed?”encourage.”6 Needless to say, if these questions are not answered correctly, He speaks of 22 large-scale operating mines, investment that is, in a pro-people context, even big amounts set aside foraggregate amounts of a little less than US$4 billion over the last Social Development and Management Programs (SDMP) wouldsix years and hopes of reaching US18 billion by 2016. be nothing more than a temporary cover-up for the unbearable For its part the Chamber added, “Last year mining invest- stench of irresponsible mining.ments in our country reached $955.85 million and could have At a time of high prices in the world market, mining can easilyeasily gone over the $1 billion mark had some projects not been cause widespread devastation to the environment all through thedelayed. Mining investments could be much higher if only some length and breadth of this archipelago, by employing open-pit andissues and concerns are resolved.”7 And the one to blame most submarine mine waste disposal methods – often fatal to people’sof all, said a Wall Street Journal article much earlier, is no less health and sure-shot destructive of the environment.than the Church. 8 How often has one seen that social and environmental impacts And what would be these issues and concerns that the are not really a factor in a mainly profit equation: verbally, yes,Chamber referred to? We would now have to go to the other maybe; but really, not at all.side for some enlightenment. Again the case of Rapu-Rapu is quite instructive. Laugh or cry if you want. Choose your mood but here are the relevantSocial and environmental cost facts. In the first paragraph of their summary reaction report on This “other” side quite simply says that the current ambition the Bastes Commission9 findings, the DENR said: “The exploi-of large-scale extraction at whatever health and environmental tation of a country’s mineral resources can only be justified if itcosts for the exportation of more minerals than is actually neces- does not irreparably damage the environment and if it benefitssary is, indeed, an immoral ambition. the community and the nation as a whole. This is beyond all In mining, says this side, the questions should be articulated argument.”correctly: “Shouldn’t we only allow the development of our It then went on to say that: “The mine tailings spills thatmineral resources for our own use rather than do so mainly for occurred at Lafayette Philippines Inc.’s polymetallic project sitemoney-making by a few in the world market?” at Rapu-Rapu Island in Albay on October 11 and 31, 2005 must More precisely, “Is the current utilization of our mineral be looked at from this solitary and singular perspective.”endowment designed to serve the basic needs of our people who Then it agreed with the Bastes Fact-Finding Commissionlive and work in a backward agricultural mode of production? Is it with regard to the major points and enumerated them thus: 18 IMPACT • November 2011
  5. 5. Who Profits From Mining In The Philippines? 1. The two tailing spills were preventable. The members of the Bastes Commission simply could not 2. Lafayette was guilty of lapses of an operational/technical find any rhyme or reason for the DENR conclusion/decisionand management nature. since the Commission’s findings on the serious violations of 3. Lafayette does not measure up to the standards of re- environmental and legal safety standards for responsible min-sponsible mining. ing had not been negated. They asked: Why not just follow the 4. DENR itself was a failure in monitoring Lafayette and rule of law rather than a culture of privilege and impunity? Inconsequently did not detect the violations that would indicate accordance with the spirit and letter of the law, DENR shouldthe possibility of environmental accidents. just cancel the Environment Clearance Certificate (ECC) of a 5. The sharing of benefits from the mineral exploitation of recidivist firm, and if allowed to re-apply, let it undertake theRapu-Rapu Island was clearly grossly unfavorable to the Philip- drawing up of an Environmental Impact Statement (EIS) andpine government. propose an Environmental Management System (EMS), pre- And with regard to the long-term environmental risks, beyond cisely as the law requires, and then let an awakened citizenrythe spills, DENR agreed with the Bastes Commission that: watch a reformed DENR do its job. That is what the Bastes “Two major issues concerning the implementation of the Commission logically recommended which the DENR so il-Project remain pending: the integrity of the tailings dam structure logically ignored.and the Acid Mine Drainage, or AMD, problem.” Do we appreciate now more deeply what we mean by a cap- Then DENR explicitly said: tive state? Who will liberate it from captivity? Can PNoy — will “On the acid mine drainage, or AMD, problem, Lafayette PNoy do so during his watch?still has to submit a viable solution. In the course of economic development and growth, many “In fact, an important ECC conditionality for the project human acts can be either right or wrong relative to their effectsis the adequacy and effectiveness of its strategy to control on the house of life we call the environment. For instance, aAMD.” certain way of exploiting some mineral resources could bring “These perceived shortcomings pertain to such matters irreparable, and therefore irreversible, damage to the environ-as the method of encapsulation to be used, the effectiveness ment. Any damage to the environment in this way can in turnof limestone in neutralizing acidic materials, the use of bring irreparable harm and injury to human health. The dramaticcomposite dry soil to seal waste rock, the sloping terrain example of the Minamata disease in Japan took years and yearsof Rapu-Rapu that makes AMD treatment difficult, and the to establish, before effects could be linked to original causesabsence of a microbial control method. In any event, the beyond reasonable doubt.long-term effects of AMD must definitely be adequately ad- Another fact is the non-renewability and non-inexhaustibilitydressed” and per DENR no less, there was no satisfactory of mineral resources. Once they are depleted, there is no waysolution proposed as yet. that they can be replaced or restored. And yet, all these serious premises considered, — here is A given mining operation, therefore, will have to be viewedwhere you want to laugh or cry — DENR struck a curve ball and by people and the State according to such perspective and first besaid, “Taking into consideration all the facts and findings, and evaluated as either ethically right or wrong, good or bad, before itall the opinions expressed on the various issues, DENR feels that could even be considered legal or illegal, before it can be judgedthe best option to take is to allow Lafayette to resume operations economically profitable or non profitable. In sum, mining is notsubject to certain stringent pre-conditions.” purely an economic nor merely a legal issue. It is primarily an Photo courtesy of Philippine Misereor Partnership Volume 45 • Number 11 19
  6. 6. COVERS TO RY Photo courtesy of Philippine Misereor Partnershipenvironmental issue and as such, must be ,Venezuela 32.82% ,Peru 36.52%, United Board of Directors (even as a non-votinggoverned and justified within the context States 36.61%, Mexico 37.21%, Botswana Member) in all mining companies operat-of environmental ethics or what is now 40.10%, Brazil 40.85%, Argentina 46.13%, ing in the Philippines in order to safeguardcalled geo-ethics. Canada 46.71%, Guyana 48.16%, Austra- the data and information filed as a basis The Church’s side could not be against lia 50.60% ) ! In the Philippines, however, for taxes and royalty payments to themining per se, contrary to propaganda by it is exactly 0%, believe it or not. In a new government. 10the first side. It recognizes that for millennia mining law this share for the Philippines The President has committed him-upon millennia now, the evolution and de- should be upgraded to 50%. self to transparency in governance. Thevelopment of the human species has always Mining, after all, is that kind of invest- Church-inspired movement to regardbeen accompanied by some form of min- ment which is neither market-seeking nor mining in the context of environmentaling: from the most primitive demand for efficiency-seeking so much as just plain concerns is getting stronger by the day.stones in the Paleolithic era to the current clear asset-seeking. But the Philippines has It is time for the contradictory thesis anddemand for rare earth elements, a demand become such a give-away country—the antithesis to agree on a new synthesis,dictated by the lifestyle of a species that State and the Filipino people have been towards a stable, healthy and prosperouscould, come to think of it, choose now to so remiss in their duty as stewards. The Philippines: that all may be one. Ievolve or develop otherwise and thus live government concedes to the foreign cor-in organic harmony with Earth. poration practically for free its beneficial (Charles Avila is the Director for Social Because of the weakness of the Philip- ownership over the mineral resources. Justice of LSSAJ (Lay Society of St. Ar-pine state, mining was not banned where it Supreme Court decisions on this issue nold Janssen), and Vice-Chairman of the defunct Rapu-Rapu Fact Finding Commis-should never have been allowed any time at notwithstanding, it is simply treasonous sion (RRFFC). This is an abridged editionall, namely in high environmentally critical for the state to surrender ownership of of a speech he delivered at the Ecumenicalareas such as small island ecosystems with the national patrimony just like that. Or is Bishops’ Forum, October 5, 2011, Bethle-steep slopes and heavy rainfall patterns someone else pocketing that portion which hem Center, Bacacay, Albay.)in typhoon belt and acid mine drainage rightfully belongs to the State? _____________areas – in areas precisely like the islands And finally, going back to the un- 1 Quoted in Chairman, Chamber of Mines of the Philippines Closing Remarks Mining Philippines 2011.of Rapu-Rapu. learned lessons of Rapu-Rapu, the Com- 2 Ibid. mission audited the amount of tons ore 3 Mining firm exceeds social compliance” by Melody M. Aguiba, TheProposal milled (as reported in its books and to Manila Bulletin, September 25, 2011. 4 Chamber President’s Welcome Remarks, Mining Philippines 2011, Here is a concrete proposal to strength- the government) against the shipping September 14, 2011.en the financial capacity of the State so that documents presented by the shipping 5 The information on early Christian teachings are found in Charles Avilait can have the wherewithal to become an companies. The discrepancy was in the Ownership: Early Christian Teaching, Sheed and Ward, London, Orbiseffective and responsible steward of the neighborhood of 50% more shipment than Books, New York, Wipf and Stock, Oregon, and Allen John Publishing, Manila. I have taken liberties in summarizing papers and discussions onnational patrimony: amend the Mining what was declared and reported in its books geoethics propounded by the Bishops members of the Rapu-Rapu FactAct to include the crucial provision of the and to the government. So, the Bastes Com- Finding Commission. A lot of these appear in speeches and papers bygovernments pre-tax share of the cash mission asked: wasn’t the Government take Bishop Arturo Bastes, SVD, DD and Bishop Jose Rojas DD. 6 Speech at Asia Mining Congress 2011, April 6, 2011, Singapore.flow generated by a mining project. In for every ton-ore-milled already slashed 7 ChamberPresident’sWelcomeRemarks,MiningPhilippines2011, September 14, 2011.most countries around the world where in half from the very start? 8 James Hookway, “Church Effort Slows Philippine Mining,” WSJ, 2-13-09.there is mining this pre-tax share repre- Hence, this other amendment pro- 9 Formally called “The Rapu-Rapu Fact-Finding Commission:” this wassenting the national patrimony averages a posed for a new Mining Law: the govern- created by a Presidential executive order and headed by Bishop Arturo Bastes, SVD, DD of Sorsogon, near Rapu-Rapu mining sites.hefty 38% (Chile 15.00% , Bolivia 27.06% ment must have a representation in the 10 Proposal by DGConsulting, 20 IMPACT • November 2011