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Turning off investors


by J. Albert Gamboa

Department of Environment and Natural Resources (DENR) Secretary Gina Lopez’s recent decision to close 23 metallic mines caught extractive industry leaders by surprise.

 Among those to be closed are the mining operations of seven corporate members belonging to the industry group, Chamber of Mines of the Philippines (COMP), while another three are facing suspension. Lopez made the announcement at a hastily called press conference last week.

She initially listed 14 mines for closure and six for suspension, and added a 15th mine to be closed toward the end of the briefing. That same evening, the DENR issued a new list naming a total of 23 mines for closure and only five for suspension.

COMP Chairman Artemio Disini said the affected companies have not received any communication from the DENR regarding the latest audit report. This came despite their repeated requests for copies of the complete report that apparently fell on deaf ears. “We have done this repeatedly, verbally and in writing, but we get no response,” he said, disclosing that Lopez told them the report is too complicated.

A team from the Mines and Geosciences Bureau (MGB) reviewed the audit report but the DENR chief allegedly declined to release the MGB team’s recommendations. At last Thursday’s press briefing, she said to newspaper reporters: “What’s important here is the decision I make as a Cabinet Secretary, not the recommendations. Don’t try to make things complicated.”

According to a source privy to the report, the review team recommended the suspension of the mines’ operations instead of their being closed permanently. Violations cited such as absence of tree-cutting permits, insufficient rehabilitation of mines areas, and construction of alternate haul roads are rectifiable and therefore do not warrant permanent closure.

But the source said that being the department’s boss, Lopez has all the discretion to decide on actions to be taken, remarking that “the only question is: What was her basis in her decision?”

It seems the DENR has given up on the mining industry altogether by sitting on recommendations to revive a sector that has the potential to generate massive revenues for the economy and propel the Philippines to First World status.

By not clearly defining a development strategy for the extractive industries, the department has turned off many large-scale mining investors. These global mineral development firms have the expertise as well as the capital to develop the country’s rich natural resources sustainably and responsibly.

Who would be willing to engage in mineral production when bottom lines cannot be ascertained amid the hostile attitude towards the industry? Meanwhile, small-scale miners have been emboldened by this seeming lack of direction, and many have resorted to illegal mining methods since they know that regulators do not have the political will and manpower capability to prosecute them.

One of the operations being suspended is that of Australian miner OceanaGold Corporation, which declared that it would “not rule out commencing proceedings to appeal to a higher authority and seek to stay and overturn” the DENR order once it gets a copy.

Vicente Lao, the owner of a firm ordered by Lopez to be closed, Mt. Sinai Mining Exploration and Development Corporation, said: “There has to be due process.”  For its part, the COMP leadership is reaching out to the government’s inter-agency body, the Mining Industry Coordinating Council (MICC).

As constituted under Executive Order No. 79, the MICC is co-chaired by the heads of the Cabinet Clusters on Economic Development and Climate Change Adaptation and Mitigation, which are the Secretaries of the Department of Finance (DOF) and the DENR, respectively. Members include the Department of Justice (DOJ) Secretary, the National Commission on Indigenous Peoples (NCIP) Chairman, and the Union of Local Authorities of the Philippines (ULAP) President.

Disini said the affected miners could appeal to President Rodrigo Roa Duterte “before going to the courts.” According to the COMP head, members of the MGB review team were banned from attending the DENR’s press briefing on Feb. 2. In a letter to DOF Secretary Carlos Dominguez III, he said that not allowing the MGB personnel to attend the press conference leaves a lot of doubt in the fairness of the entire process.

Lopez insisted that notices were sent out to concerned companies last week. “They can make an appeal to the President. Finality of the order would depend on the President,” she said.

However, the CEO of Eramen Minerals, Inc. that has also been ordered for closure, Enrique Fernandez said: “We have never received any report. All we got was a set of questions that we should answer. There should be freedom of information here.”

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of FINEX.


J. Albert Gamboa is chief financial officer of Asian Center for Legal Excellence and Senior Advisor of KSearch Asia Consulting, Inc. and co-chairs for FINEX Media Affairs Committee. nextgenmedia@gmail.com

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  • Oliver Vicente

    She is unfit to be head the DENR. Being an anti-mining activist is has her biases and she cannot be reasoned with. She banned the MGB from attending the press briefing and she refuses to show the audit even to the companies she decided to close down, who in the right mind would do that?

  • Mitch Ilano

    These are real people who will lose their livelihood bec of Gina’s indiscriminate decision and yet she’s oblivious to it. Even asking for 2 years to give them an alternative livelihood. 2 years! In the meantime, what will these people do then?