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Philippine Mining Law:Issues & Concerns
Mr. Benjamin A. Cabrido Jr.Professor on Environmental LawUniversity of San Jose – RecoletosCollege of Law, Cebu City
Introduction
We must therefore encourage and support the 'ecological conversion' which in recent decades has made humanity more sensitive to the catastrophe to which it has been heading.
Man is no longer the Creator's 'steward', but an autonomous despot, who is finally beginning to understand that he must stop at
the edge of the abyss". [Pope John Paul II 17 January 2001]
Outline
Philippine Mining Law of 1995 & its IRR People’s Small Scale Mining Act of 1991 & its IRR The La Bugal & Didipio Cases: Did they resolve
the issues affecting Mining? Issues & Concerns
Environment Indigenous People Labor Corruption Other issues and concerns
Conclusion
Republic Act No. 7942
The Philippine Mining Act of 1995
Previous Laws on On-shore Mining
Royal Decree of May 14, 1867 Art. 339 of the Civil Code of Spain Philippine Bill of 1902 as amended on Feb. 6,
1905 Act No. 624 P.D 463, May 17, 1974 P.D 1281, Jan. 16, 1978 as amended by P.D
1654 on Dec. 14, 1979
Laws Governing Other Minerals
For coal: Act No. 2719 (The Coal Land Act) and P.D. No. 972.
For petroleum: R.A. No. 387 (Petroleum Act of
1949) as amended & P.D. No. 87
State Policy on Mining
Assertion of Jura Regalia. Rational exploration, development, utilization
and conservation. Public and Private Participation. National Growth without impairment of the
environment. Protection of the Indigenous People’s Rights.
Jurisdiction Panel of Arbitrators
Disputes involving rights to mining areas. Disputes involving mineral agreements or
permits Disputes involving surface owners, occupants
and claimholders/concessionaires; and Disputes pending before the Bureau and the
Department at the date of the effectivity of R.A. 7942.
Jurisdiction of MGB
Appellate: Decisions from Panel of Arbitrators Within fifteen (15) days from receipt To decide the case within thirty (30) days from
submission
Concept of Jura Regalia
Universal feudal theory that all lands were held from the Crown (Carino v. Insular Govt, 41 Phil. 935)
Foundation of the 1st sentence of Sec. 2, Art. XII, 1987 Constitution
In the Republican system of Government, the medieval concept of jura regalia has been stripped of its regalian overtones (Lee Hong Kok v. David, 48 SCRA 372)
Important Terms Used In Mining Law
Ancestral lands - Refers to all lands exclusively and actually possessed, occupied, or utilized by indigenous cultural communities by themselves or through their ancestors in accordance with their customs and traditions since time immemorial, and as may be defined and delineated by law.
Notes: Ancestral domain and ancestral lands are not part of
lands of the public domain. The right of natives does not include natural resources.
What is given is priority rights, not exclusive right. State not precluded from entering into agreements with
private entities. (Cruz v. Secretary, GR 135385, Dec. 6, 2000)
Block or meridional block - Area bounded by one-half (1/2) minute of latitude and one-half (1/2) minute of longitude, containing approximately eighty-one hectares (81 has.).
Carrying capacity – The capacity of natural and human environments to accommodate and absorb change without experiencing conditions of instability and attendant degradation.
Ecological profile or eco-profile – The geographic-based instruments for planners and decision-makers which presents an evaluation of the environmental quality and carrying capacity of an area.
Environmental compliance certificate (ECC) - The document issued certifying that the project under consideration will not bring about an unacceptable environmental impact and that the proponent has complied with the requirements of the environmental impact statement system.
Environmental impact statement (EIS) - The document which aims to identify, predict, interpret, and communicate information regarding changes in environmental quality associated with a proposed project and which examines the range of alternatives for the objectives of the proposal and their impact on the environment.
Foreign-owned corporation - Any corporation, partnership, association, or cooperative duly registered in accordance with law in which less than fifty per centum (50%) of the capital is owned by Filipino citizens.
Gross output - The actual market value of minerals or mineral products from its mining area as defined in the National Internal Revenue Code.
Mine wastes and tailings – The soil and rock materials from surface or underground mining and milling operations with no economic value to the generator of the same.
Minerals - refers to all naturally occurring inorganic substance in solid, gas, liquid, or any intermediate state excluding energy materials such as coal, petroleum, natural gas, radioactive materials, and geothermal energy.
Ore - means a naturally occurring substance or material from which a mineral or element can be mined and/or processed for profit.
Other Mining Terms
Mine – In its specific sense, is a work for the excavation of minerals, by means of pits, shafts, levels, tunnels, and others, as opposed to a ‘quarry’ where the whole excavation is open. Whether any excavation be a mine or not depends on the mode in which is worked, and not on the substance obtained from it. (18 R.C.L. 2, pp. 1092-1093 as quoted in Law on Natural Resources, Pena, pp. 110)
Vein or Lode – A seam or fissure in the earth’s crust filled with quartz or some other kind of rock in place carrying gold, silver, or other valuable mineral deposits named in the statute.
Lode (alteration of the verb lead) - Used by miners to mean as the formation by which they are led or guided in the search for ore. A load may contain more than one vein. The space between the walls or boundaries of the earth’s crust is called FISSURE and if in such fissure ore is found although at considerable intervals and in small quantities, it is called a LODE or VEIN. A Vein is by no means a straight line, or of uniform dip or thickness, or richness of mineral matter, throughout its course.
Apex of vein – Is the uppermost edge of the vein or the course thereof, in place at or near the surface of the earth. [Ibid]
Mining Claim – A parcel of land containing precious metal in its soil or rock, and is often used in mining parlance as synonymous with the term ‘location’, which means the act of appropriating a mining claim on the public domain, according to established laws or rules. [Watson v. Lederer, 11 Colo. 577,19 Pac. 602, 7 A.S.R. 263, 1 L.R.A. 854; 18 R.C.L. 2, pp. 1092]
Lode Claim – A parcel of mineral land containing a vein, lode, ledge, lens, or mass of ore in place which has been located in accordance with law. [Sec. 13, C.A. 137]
Placer Claim – Is that which does not come under the definition of lode mineral claim. [Ibid]
Assay – A test by means of chemical analysis to determine the purity of fineness of metals, particularly precious metals. Hence, gold, silver, and platinum are assayed for the number of ounces per ton of ore; while lead, copper, zinc and base metals are assayed for
the percentage of their contents in the ore. [Morrison, Mining rights, pp. 491-492]
Quarry resources – Any common stone or other common mineral substances as the MGB Director may so declare, such as, but not restricted to: marl, marble, granite, volcanic cinders, basalt, tuff, and rock phosphate, gabbro, serpentine, inset filling materials, clay for ceramic tiles and building bricks, pumice,
perlite and other similar materials provided they contain no metals or other valuable minerals in economically substantial quantities. [Sec. 2-I, PD 463 & Sec. 43, R.A. 7942]
Areas Open to Mining Operations (Sec. 14, IRR)
Public or private lands not covered by valid and existing mining rights and mining applications;
Lands covered by expired/abandoned/ canceled mining/quarrying rights;
Mineral Reservations; and Timber or forest lands as defined in existing
laws (?).
Areas Closed to Mining Applications (Sec. 19)
a. In military and other government reservations, except upon prior written clearance by the government agency concerned; b. Near or under public or private buildings, cemeteries, archeological and historic sites, bridges, highways, waterways, railroads, reservoirs, dams or other infrastructure projects, public or private works including plantations or valuable crops, except upon written consent of the government agency or private entity concerned; c. In areas covered by valid and existing mining rights;
e. In areas covered by small-scale miners as defined by law unless with prior consent of the small-scale miners, in which case a royalty payment upon the utilization of minerals shall be agreed upon by the parties, said royalty forming a trust fund for the socioeconomic development of the community concerned; and f. Old growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, mossy forests, national parks provincial/municipal forests, parks, greenbelts, game refuge and bird sanctuaries as defined by law and in areas expressly prohibited under the National Integrated Protected Areas System (NIPAS) under Republic Act No. 7586, Department Administrative Order No. 25, series of 1992 and other laws.
Prior Informed Consent From ICCs (Sec. 16, IRR)
No mining permits to be issued in CADCs/CALCs or areas actually occupied by Indigenous Cultural Communities under a claim of time immemorial possession unless there is PRIOR INFORMED CONSENT from them, based on their customary laws.
Public notice via: (a) newspaper, radio or television advertisements, fully disclosing the activity to be undertaken; and (b) sector consultation thru community assembly, which notice should be announced or posted in a conspicuous place in the area for at least a month before the assembly.
Fraud, external influence and manipulations prohibited.
Royalty entitled to ICC: 1% of G.O. Expenses for community development
deductible from royalty. In case of disagreement concerning the
royalty: Department to resolve the same within three (3) months.
Royalty to form part of a Trust Fund for the socioeconomic well-being of the ICC based on the management plan formulated for such ancestral land or domain area:
Mining Tenements under R.A. 7942
A. Tenement issued by DENR1. Exploration Permit2. Mineral Agreements - Mineral Production Sharing Agreement
- Joint Venture Agreement- Co-production Agreement
3. Financial or Technical Assistance Agreement 4. Mineral Processing Permit
5. Industrial Sand & Gravel PermitB. Permit issued by LGU
1. Quarry Permit2. Small-Scale Mining Permit3. Sand & Gravel Permit
Maximum Areas for Exploration Permit (Sec. 22, IRR as amended by AO 03-46)
a. Onshore, in any one province 1. for individuals, twenty (20) blocks: and
2. for partnerships, corporations, cooperatives, or associations, two hundred (200) blocks.
b. Onshore, in the entire Philippines 1. for individuals, forty (40) blocks; and
2. for partnerships, corporations, cooperatives, or associations, four hundred (400) blocks.
c. Offshore, beyond five hundred meters (500m) from the mean low tide level:
1. for individuals, one hundred (100) blocks; and
2. for partnerships, corporations, cooperatives, or associations, one thousand (1,000) blocks.
Declaration of Mining Project Feasibility (Sec. 25)
By the holder of an exploration permit After determination of the commercial viability
of a project covering a mining area To be filed at the MGB within the term of the
permit. Upon approval and compliance with other
requirements will entitle the holder to an exclusive right to a mineral production sharing agreement or other mineral agreements or FTAA.
But he/it must do so within (1) year otherwise the declaration will be cancelled. (DAO 2005-15)
Publication Requirements (Secs. 21,38, & 55, IRR)
Permitee to cause the publication, posting and radio announcement of the Notice within fifteen (15) working days from receipt.
Publication requirement: Once a week for two (2) consecutive weeks in two (2) newspapers (one of general circulation published in Metro Manila and another published in the municipality or province where the proposed permit area is located).
Radio Announcement: Daily for two (2) consecutive weeks in a local radio program.
Posting requirement: 2 consecutive weeks at BBs of MGB offices, CENRO, PENRO, Capitol, Mun. Hall, copy furnished the barangay/s.
Maximum Areas for Mineral Agreements (Section 28)
a. Onshore, in any one province:
1. for individuals, ten (10) blocks; and 2. for partnerships, cooperatives, associations, or corporations, one hundred (100) blocks.
b. Onshore, in the entire Philippines: 1. for individuals, twenty (20) blocks; and
2. for partnerships, cooperatives, associations, or corporations, two hundred (200) blocks.
c. Offshore, in the entire Philippines
1. for individuals fifty (50) blocks; 2. for partnerships, cooperatives, associations, or corporations, five hundred (500) blocks; and
3. for the exclusive economic zone, a larger
area to be determined by the Secretary. Does not include mining/quarry areas under
operating agreements between the contractor and a claimowner/lessee/permittee/licensee entered into under Presidential Decree No. 463.
Mandatory Requirements for Applications for Mineral Agreements (Sec. 35, IRR) Location map/sketch plan of the proposed contract
area. Two-year Exploration Work Program or three-year
Development/Utilization Work Program,where applicable.
Satisfactory Environmental Management Record and Community Relations Record, If applicable.
Environmental Work Program during the exploration period;
Proof of technical competence. Proof of financial capability. Declaration of the total area. For corporations: SEC registration, AI, BLaws, etc.
Mineral Production Sharing Agreement (MPSA) Exclusive right to conduct mining operation w/in a
contract area. Limited to Filipinos or Filipino-owned corporation
(Foreign equity not exceed 40%). Maximum capital: P10M; Paid-up: P2.5M Maximum area for juridical entity: 8,100 has. (province);
16,200 (entire country) Contract period: 25 yrs. renewable for another 25 yrs. 2 yrs. exploration period; 3 yrs. construction and
development period; rest for production. Can be assigned to qualified individuals/corporations. Can be converted to FTAA.
Co-Production Sharing Agreement
An agreement between the Government and the contractor wherein the Government shall provide inputs to the mining operations other than the mineral resource. (Sec. 26[b], R.A. 7942, The Philippine Mining Act of 1995)
Joint Venture Agreement
An agreement where a joint-venture company is organized by the Government and the contractor with both parties having equity shares. Aside from earnings in equity, the Government shall be entitled to a share in the gross output. (Sec. 26 [c], R.A. 7942, The Philippine Mining Act of 1995)
Maximum Contract Area For FTAA (Section 34)
a. 1,000 meridional blocks onshore; b. 4,000 meridional blocks offshore; or c. Combinations of (a ) and (b) provided that it shall not exceed the maximum limits for onshore and offshore areas.
Specific Minerals Subject to FTAA (Sec. 50, IRR)
Gold, copper, nickel, chromite, lead, zinc and other minerals.
Excluded: Cement raw materials, marble, granite, sand and gravel and construction aggregates.
NOTE: Stipulations in Mineral Agreements & FTAA now governed by DAO 2004-54, as further amended by DAO 2007-12.
Transfers/Assignments of Exploration Permits, Mineral Agreements, FTAA (Secs. 25, 40, 57 & 66, IRR)
EP: Subject to the approval of the Secretary upon the recommendation of the Director.
MPSA, CPA & JV & FTAA Application: Subject to the approval of the Regional Director taking into account the national interest and public welfare. Restrictions: Eligibility of Transferee & Not made for speculative purposes.
FTAA: Endorsement by the Director; recommendation by DENR Secretary and approval by the President.
Easement Rights Over Surface Lands (Sec. 104, IRR)
Purpose: Build or install infrastructures as roads, railroads, mills, waste dump sites, tailings, ponds, warehouses, staging or storage areas and port facilities, etc. on mining areas or other lands occupied/owned by other persons
Right to enter and occupy mining areas or lands upon payment of just compensation.
Eminent Domain? (Sec. 105, IRR)
Right to enter and occupy into surface land within a mining area for exploration, development and utilization.
Requisites: Written notices to surface owners and bond. If owner cannot be located, notice served to MGB Director.
Just compensation: LIMITED TO THE DAMAGE TO THE PROPERTY AS CONSEQUENCE OF MINING OR RESULTING FROM CONSTRUCTION OF INFRASTRUCTURE!
Manner Arriving at Just Compensation
By voluntary agreement. In case of disagreement or in the absence of
an agreement, issue to be brought to the panel of arbitrators.
Note: Either situation, contractor shall post a bond upon agreement by the parties.
If parties disagree – MGB Director to determine the amount of bond!
General Provisions on Quarry Operations (Sec. 69 as amended by AO 03-46)
Quarry sand and gravel, guano and gemstone resources is allowed both in private and/or public lands.
If large-scale quarry (mechanized): Apply for any of the mineral agreements.
Area limitations (hectares): Sand/Gravel/Lahar: 20 (Individual) & 50 (Corp) Marble/Granite/Construction aggregates: 81
(Individual & 243 (Corp) Limestone, shale, silica [cement]: 486
(Individual) & 1,458 (Corp.)
Jurisdiction Of Provincial/City Mining Regulatory Board (Sec. 70, IRR)
Applications for Quarry, Sand and Gravel, Guano, Gemstone Gathering and Small-Scale Mining Permits.
Chairman: MGB Director. Vice-Chair: Governor/City Mayor Members: SSM rep, LSM rep, accredited NGO
Quarry Permit (Sec.71, IRR)
Area: Not more that 5 hectares. Term:5 years, renewable for the same period
but not exceeding 25 years. Where to Apply: Governor/City Mayor through
the P/CMRB.
Commercial Sand/Gravel Permit (Sec. 72[a], IRR)
Coverage: Extraction, removal and disposition of sand and gravel and other loose or unconsolidated materials which are used in their natural state without undergoing processing.
Area: Not more than 5 hectares. Term: 1 year, renewable in like periods. Restriction: 1 permit per person per
municipality. Where to apply: Governor/City Mayor through
P/CMRB
Industrial Sand/Gravel Permit (Sec. 72[b], IRR)
Coverage: Extraction, removal and disposition of sand and gravel and other loose or unconsolidated materials that necessitate the use of mechanical processing.
Area: Not more than 5 hectares at any given time.
Term: 5 years, renewable in like periods but not to exceed 25 years.
Where to apply: Governor/City Mayor through the P/CMRB
If area is more than 5 has. but not exceeding 20 has., jurisdiction is with RD, MGB.
Exclusive Sand/Gravel Permit (Sec. 72[c], IRR)
Coverage: Extraction, removal and utilization of sand and gravel and other loose or unconsolidated materials from public land for applicant’s own use.
Area: 1 hectare Term: Not exceeding 60 days, non-renewable. Limitation: 50 cubic meters maximum & no
commercial disposition.
Gratuitous Permits Public -Government entity/ instrumentality in
need of quarry, sand and gravel or loose/unconsolidated materials in the construction of building and/or infrastructure for public use or other purposes. Term: 1 year; Area: 2 hectares.
Private – Applicant is the landowner himself. Purpose: extraction, removal and utilization of quarry, sand and gravel or loose/ unconsolidated materials from his land. Term: 60 days, non-renewable. Proof of ownership and personal use of materials.
Restrictions in Quarrying Operations
No extraction allowed within one (1) kilometer from the boundaries of reservoirs established for public water supply, archaeological and historical sites or of any public or private works or structures.
No extraction allowed in offshore areas within five hundred (500) meters distance from the coast and two hundred (200) meters from the mean low tide level along the beach.
Ore Transport Permit (Sec. 117, IRR, as amended by AO 2003-46)
Transport of all minerals/mineral products and by-products, including gold bullions, by Permit Holders, Contractors, accredited traders, retailers, processors and other mining rights holders must be accompanied by an Ore Transport Permit (MGB Form No. 12‑1) issued by the Regional Director concerned or his/her duly authorized representative.
Transport of sand and gravel shall be covered by a Delivery Receipt.
P/CMRF to formulate its own policies to govern such transport of ores produced by small‑scale miners.
For MPSA & FTAA: OTP included in the agreement. Prior written notice to MGB required.
OTP not necessary for ore samples not exceeding two (2) metric tons to be used exclusively for assay and pilot test purposes. Only certification from MGB is required.
The absence of a permit shall be considered as prima facie evidence of illegal mining and shall be sufficient cause for the Government to confiscate the ores or minerals being transported, the tools and equipment utilized, and the vehicle containing the same.
The absence of a permit shall be considered as prima facie evidence of illegal mining and shall be sufficient cause for the Government to confiscate the ores or minerals being transported, the tools and equipment utilized, and the vehicle containing the same.
Selected Mineral Production Volume
Role of LGUs In Mining (Sec. 8, IRR, R.A. 7942)
Ensure that relevant laws on public notice, public consultation and public participation are complied with;
Approve applications for small-scale mining, sand and gravel, quarry, guano, gemstone gathering and gratuitous permits and for industrial sand and gravel permits not exceeding five (5) hectares;
Share from taxes, fees and charges in accordance with Sections 290 and 292 of Republic Act No. 7160 ;
Facilitate in the process to achieve an informed decision on the social acceptability of a mining project as required by ECC;
Participate in the monitoring of any mining activity as a member of the Multipartite Monitoring Team;
Participate as a member of the Mine Rehabilitation Fund Committee;
Recipient of social infrastructure and community development projects for the utilization of the host and neighboring communities;
Act as mediator between the ICCs and the Contractor as may be requested; and
Other powers granted by applicable laws and rules.
Membership in MMT & MRFC; Recipient of social infrastructure and
community development projects for the utilization of the host and neighboring communities;
Act as mediator between the Indigenous Cultural Community and the Contractor if requested.
Grounds Cancellation/ Revocation/ Revocation (Sec. 230, IRR)
Violation of any of the terms and conditions of the Permits or Agreements;
Non-payment of taxes and fees due the Government for two (2) consecutive years; and
Falsehood or omission of facts in the application for Exploration Permit, Mineral Agreement, FTAA or other permits which may alter, change or affect substantially the facts set forth in said statements.
Effect of Cancellation/Expiration (Sec. 232, IRR)
Expiration: - Gov’t to undertake operation or through
qualified independent contractor after bidding. - Contractor has right to equal highest bid and
reimburse expenses by that bidder. Cancellation: - To be entered in the Registration Book. - Notice to be posted on BB of MGB & RO. - Mining area will be open for new applicants.Note: Non-payment of taxes & fees may result to
cancellation and opening of the area for new applicants.
Environmental Protection Objectives (Sec. 167, IRR)
Maintenance of sustainable environmental conditions at every stage of the mining operation. Principle of progressive rehabilitation.
Establishment of a functional post-disturbance land use capability, i.e. minesite decommissioning and rehabilitation should aim to establish a land use capability that is functional and proximate to the land use prior to the disturbance of the mine area.
Preservation of downstream freshwater quality. Preservation of sea water quality and natural
habitats for marine life. Prevention of air and noise pollution;
Respect for the traditional and/or sustainable management strategies concerning natural resources of Indigenous Cultural Communities and other communities.
Environmental Work Program (EWP)
Applies to EPs, MAs, & FTAAs. Detailing the environmental impact control and
rehabilitation activities proposed during the exploration period including the costs to enable sufficient financial resources to be allocated to meet the environmental and rehabilitation commitments.
Provide a description of the expected and considered acceptable impacts.
Set out the environmental protection and enhancement strategies based on best practice in environmental management in mineral exploration.
To be furnished to Sangguniang Panlalawigan.
Environmental Protection & Enhancement Program (EPEP)
Required of MAs & FTAAs. Provides a description of the expected and
considered acceptable impacts and sets out the life-of-mine environmental protection and enhancement strategies based on best practice in environmental management in mining.
Includes a statement on post-mining land use potential for various types of disturbed land (pits, waste dumps, tailings-impounding structures and infrastructure sites) and extends to the completion of the commitments in the rehabilitation of the disturbed land in a technically, socially and environmentally competent manner.
Contractor to allocate for its initial environment-related capital expenditures an amount that shall approximate ten percent (10%) of the total capital/project cost or such other amount depending on the environmental/geological condition, nature and scale of operations and technology employed.
EPEP to be filed and evaluated by Mine Rehabilitation Committee MGB.
All preliminary evaluations will be consolidated and forwarded to the Contingent Liability and Rehabilitation Fund (CLRF) Steering Committee for approval.
Annual EPEP
Based on the approved EPEP and shall be implemented during the year of its submission.
Includes, but shall not be limited to, exploration, development, utilization, rehabilitation, regeneration, revegetation and reforestation of mineralized areas, slope stabilization of mined-out areas, waste dumps (acid mine drainage control), tailings-covered areas, aquaculture, watershed development and water conservation and socioeconomic development.
Three to five percent (3-5%) of direct mining and milling costs to be allocated for annual environment-related activities
Organization of a Mine Environmental Protection and Enhancement Office (MEPEO)
All Contractors/Permit Holders shall incorporate in their mine organization structures an MEPEO.
Headed preferably by either a licensed Mining Engineer, Geologist or Metallurgical Engineer or by an Environmental Engineer with at least five (5) years experience in actual mining environment work.
Environmental Monitoring and Audit
To be undertaken by the Multipartite Monitoring Team (MMT) at least every quarter.
Expenses for such monitoring chargeable against the Monitoring Trust Fund of the Mine Rehabilitation Fund.
Environmental monitoring reports to be submitted by the MMT to the MRF Committee.
Independent environmental audit to be undertaken regularly by the Contractor to identify environmental risks affecting mining operations to serve as a basis for the development of an effective environmental management system.
Contingent Liability and Rehabilitation Fund
Mine Rehabilitation Fund: - Monitoring Trust Fund (MTF): 50,000
- Rehabilitation Cash Fund: P5,000,000 at least.
Mine Waste and Tailings Fees P0.05/MT of mine waste produced and P 0.10/MT of mill tailings.
Regional Investigation and Assessment Teams (RIAT)
Provides advice to interested parties on matters related to claims for compensation for damages;
Provides applications and other related forms to prospective claimants for damages;
Receives applications for compensation for damages;
Conducts field investigations and assessments of claims for damages (MGB Form No. 18-3) and submits reports to the CLRF Steering Committee through the TWG.
Application for compensation for damages to be filed within thirty (30) calendar days from the occurrence of the damage.
DEVELOPMENT OF MINING COMMUNITIES,SCIENCES AND MINING TECHNOLOGY
Contractor/Permit Holder/Lessee to assist in the development of the host and neighboring communities and mine camp to promote the general welfare of the inhabitants living therein.
To assist in developing mining technology and geosciences as well as the corresponding manpower training and development;
To allot annually a minimum of one percent (1%) of the direct mining and milling costs necessary to implement the above.
Credited Activities or Expenditures
Establishment and maintenance of community schools, hospitals, churches and recreational facilities which will be open to the general public whether or not they are mine employees.
Construction and maintenance of community access roads, bridges, piers and wharves;
Establishment and maintenance of communication, waterworks, sewerage and electric power systems which are accessible to mine employees and members of the community;
Development and maintenance of community housing projects for mine employees and members of the community;
Establishment of training facilities for manpower development for mine employees and members of the community; and
Establishment of livelihood industries for the dependents of the mine employees as well as for other members of the community.
Republic Act No. 7076
PEOPLE'S SMALL-SCALE MINING ACT OF 1991
State Policies On Small-Scale Mining
Promote, develop, protect and rationalize viable small-scale mining activities;
Generate more employment opportunities and provide an equitable sharing of the nation's wealth and natural resources.
Important Terms In People’s Small-Scale Mining Act
Small-scale mining - refers to mining activities which rely heavily on manual labor using simple implement and methods and do not use explosives or heavy mining equipment.
Small-scale mining contract - refers to co-production, joint venture or mineral production sharing agreement between the State and a small-scale mining contractor for the small-scale utilization of a plot of mineral land.
Mining plan - A two-year program of activities and methodologies employed in the extraction and production of minerals or ore-bearing materials, including the financial plan and other resources.
Mineralized areas - Those with naturally occurring mineral deposits of gold, silver, chromite, kaolin, silica, marble, gravel, clay and like mineral resources.
Active mining areas – Those under actual exploration, development, exploitation or commercial production as determined by the Secretary after the necessary field investigation or verification including contiguous and geologically related areas belonging to the same claimowner and/or under contract with an operator, but in no case to exceed the maximum area allowed by law.
Existing mining right - That perfected and subsisting claim, lease, license or permit covering a mineralized area prior to its declaration as a people's small-scale mining area.
Claimowner - A holder of an existing mining right.
Processor – A person issued a license to engage in the treatment of minerals or ore-bearing materials such as by gravity concentration, leaching benefication, cyanidation, cutting, sizing, polishing and
other similar activities.
Applications for SSM
To be filed in the Office of the Provincial Governor/City Mayor through the Provincial/City Mining Regulatory Board concerned for areas outside the Mineral Reservations.
Mandatory Requirements SSM (Sec. 20, DAO 2005-15) Location map/sketch plan of the proposed permit
area showing its geographic coordinates/meridional blocks and boundaries in relation to major environmental features and other projects using a NAMRIA topographic map in a scale of 1:50,000 duly prepared, signed and sealed by a deputized Geodetic Engineer;
Two (2)-Year Utilization Work Program duly prepared, signed and sealed by a licensed Mining Engineer or Geologist;
Proof of technical competence: curricula vitae and track records in mining operations; and environmental management of the technical personnel who will undertake the activities based on the Utilization Work Program;
Proof of financial capability: a. For an individual – Copy of income tax return for
the preceding year and proof of bank deposit or credit line in the amount
that shall not be less than the proposed budget of the Utilization Work Program; and
b. For a corporation, partnership, association or cooperative – Latest audited financial statement and, where applicable, Annual Report for the preceding year, credit lines, bank guarantees and/or similar negotiable instruments; and
SEC Registration, Articles of Incorporation and By- Laws;
ECC, Environmental Protection and Enhancement Program and approved survey plan.
Priority To Cultural Communities Within Ancestral Land (Sec. 7, R.A. 7076)
No ancestral land may be declared as a people's small-scale mining area without the prior consent of the cultural communities concerned.
Provided, That, if ancestral lands are declared as people's small-scale mining areas, the members of the cultural communities therein shall be given priority in the awarding of small-
scale mining contracts.
Contract Area (Sec. 10, R.A.7076) Not to exceed twenty hectares (20 has.) per
contractor. Depth or length of the tunnel or adit not
exceeding that recommended by the director taking into account the following circumstances:
(a) Size of membership and capitalization of the cooperative;
(b) Size of mineralized area;(c) Quantity of mineral deposits; (d) Safety of miners;
(e) Environmental impact and other considerations; and
(f) Other related circumstances.
Prohibition On Assignment Of Rights
Small-scale mining contractor given the right to mine, extract and dispose of mineral ores for commercial purposes.
It cannot be subcontracted, assigned or otherwise transferred.
Term of License: 2 years, renewable subject to verification.
Duties and Obligations of Small-Scale Mining Contractor
Undertake mining activities only in accordance with a mining plan duly approved by the Board.
Abide by the Mines and Geosciences Bureau and the small-scale Mining Safety Rules and Regulations;
Comply with his obligations to the holder of an existing mining right.
Pay all taxes, royalties or government production share as are now or may hereafter be provided by law.
Comply with pertinent rules and regulations on environmental protection and conservation, particularly those on tree-cutting mineral-processing and pollution control.
File under oath at the end of each month a detailed production and financial report to the Board.
Assume responsibility for the safety of persons working in the mines.
Rules If Area Is Covered By Existing Mining Claim
Claim-owner and the small-scale miners are encouraged to enter into a voluntary and acceptable contractual agreement.
In case of disagreement, the claim-owner shall be entitled to the following rights and privileges:
(a) Exemption from the performance of annual work obligations and payment of occupation fees, rental, and real property taxes;
(b) Subject to the approval of the Board, free access to the contract area to conduct metallurgical tests, explorations and other activities, provided such activities do not unduly interfere with the operations of the small-scale miners
(c) Royalty equivalent to one and one half percent (1 1/2%) of the gross value of the metallic mineral output or one percent (1%) of the gross value of the nonmetallic mineral output to be paid to the claimowner: Provided, That such rights and privileges shall be available only if he is not delinquent and other performance of his annual work obligations and other requirements for the last two (2) years prior to the effectivity of this Act.
Ownership Of Mine Tailings (Sec. 16)
Small-scale mining contractor own all mill tailings produced from the contract area.
He may sell the tailings or have them processed in any custom mill in the area.
But if the small-scale mining contractor decides to sell its mill tailings, the claim-owner has a preemptive right to purchase said mill tailings at the prevailing market price.
Sale of Gold Exclusive To Government (Sec. 17)
All gold produced by small-scale miners in any mineral area are to be sold to the Central Bank, or its duly authorized representatives.
At prices competitive with those prevailing in the world market regardless of volume or weight.
Central Bank to establish as many buying stations in gold-rush areas to fully service the requirements of the small-scale minerals thereat.
Establishment/Operation of Custom Mills (Sec. 18) Limited to mineral processing zones duly designated by
the local government unit concerned upon recommendation of the Board.
If private sector is unable to establish custom mills, the Government to construct custom mills upon the recommendation of the Board based on the viability of the project.
The Board to issue licenses for the operation of custom mills and other processing plants subject to pollution control and safety standards.
It will also stablish assay laboratories to cross-check the integrity of custom mills and to render metallurgical and laboratory services to mines.
Custom mills as withholding agents for the royalties, production share or other taxes due the Government.
PD 1899 (Establishing Small-Scale as a New Dimension in Mineral Development)
PD No. 1899 and RA No. 7076 shall continue to govern small-scale mining operations.
For areas not declared as PSSMA, the pertinent rules and regulations of PD No. 1899 shall apply.
Mines Administrative Order No. MRD-41, Series of 1984, Department Administrative Order (DAO) No. 28 and MRDB Administrative Order Nos. 3 and 3A as provided in DAO No. 96-40 are governing rules for PD 1899.
DAO No. 34, Series of 1992 is the IRR of RA 7076.
SSMPs for PD 1899; SSMCs for RA 7076. In case where a PSSMA is declared covering
SSMP areas, the term of the SSMPs, including their renewal, will be recognized unless such SSMPs are revoked, cancelled or terminated with cause.
SSMP has the option to shift to a SSMC pursuant to the provisions of DAO No. 34, Series of 1997.
Term of SSMP: 2 years, renewable only once. Must apply for renewable before expiry.
No SSMP will be renewed unless its two (2)-year term is fully consumed.
Qualified Person under SSMP
Filipino citizen, of legal age, and with capacity to contract, or a corporation or partnership authorized to engage in mining, registered with the SEC, at least 60% of the capital of which is owned at all times by Filipino citizens.
For RA No. 7076, only a Filipino small-scale mining cooperative organized by licensed and registered small-scale miners may apply.
SSMP Maximum Annual Production: 50,000 DMT for ore; non-mettalic: 50,000 DMT of the material itself, e.g., 50,000 DMT of limestone, 50,000 DMT of silica, or 50,000 DMT of perlite.
Maximum Capital: 10M (both SSMP & SSMC)
Other Requirements for SSMP & SSMC
Environmental Compliance Certificate. Potential Environmental Impact Report (PEIR)
in lieu of EPEP. Final Mine Rehabilitation/ Decommissioning
Plan duly approved by the Mine Rehabilitation Fund Committee.
Community Development and Management Program which is a simplified Social Development and Management Program, duly approved by the MGB-RO.
La Bugal-B’laan Tribal Assn. vs. Ramos [G.R. 127882, Jan. 27, 2004 & Dec. 1, 2004]
Facts: March 30, 1995, the President entered into an
FTAA with WMCP covering 99,387 hectares of land in South Cotabato, Sultan Kudarat, Davao del Sur and North Cotabato.
On August 15, 1995, then DENR Secretary Victor O. Ramos issued DENR Administrative Order (DAO) No. 95-23, s. 1995, otherwise known as the Implementing Rules and Regulations of R.A. No. 7942. This was later repealed by DAO No. 96-40, s. 1996 which was adopted on December 20, 1996.
January 23, 2001 WMC sold all its shares in WMCP to Sagittarius Mines, Inc. (Sagittarius), a corporation organized under Philippine laws.
WMCP was subsequently renamed “Tampakan Mineral Resources Corporation.
WMCP claims that at least 60% of the equity of Sagittarius is owned by Filipinos and/or Filipino-owned corporations while about 40% is owned by Indophil Resources NL, an Australian company.
Issues: Constitutionality of R.A. 7942 & DAO 96-40. Validity of FTAA
La Bugal Jan. 27, 2004 Ruling
Declaring unconstitutional and void: (1) Section 3 (aq), which defines
“qualified person,” to wit: Provided, That a legally organized foreign-owned corporation shall be deemed a qualified person for purposes of granting an exploration permit, financial or technical assistance agreement or mineral processing permit. (2) Section 23 which specifies the rights and obligations of an exploration permittee, insofar as said section applies to a financial or technical assistance agreement.
(3) Section 33, which prescribes the eligibility of a contractor in a financial or technical assistance agreement;
(4) Section 35 which enumerates the terms and conditions for every financial or technical assistance agreement;
(5) Section 39 which allows the contractor in a financial and technical assistance agreement to convert the same into a mineral production-sharing agreement;
(2) All provisions of Department of Environment and Natural Resources Administrative Order 96-40, s. 1996 which are not in conformity with this Decision, and
(3) The Financial and Technical Assistance Agreement between the Government of the Republic of the Philippines and WMC Philippines, Inc.
Ratio of the Jan. 27, 2004 En banc Decision
Accordingly, following the literal text of the Constitution, assistance accorded by foreign-owned corporations in the large-scale exploration, development, and utilization of petroleum, minerals and mineral oils should be limited to “technical” or “financial” assistance only.
The phrase “management or other forms of assistance” in the 1973 Constitution was deleted in the 1987 Constitution, which allows only “technical or financial assistance.” Casus omisus pro omisso habendus est. A person, object or thing omitted from an enumeration must be held to have been omitted intentionally
The phrase “service contracts” has been deleted in the 1987 Constitution’s Article on National Economy and Patrimony. If the CONCOM intended to retain the concept of service contracts under the 1973 Constitution, it could have simply adopted the old terminology (“service contracts”) instead of employing new and unfamiliar terms (“agreements . . . involving either technical or financial assistance”).
Service contracts actually vested foreigners with the right to dispose, explore for, develop, exploit, and utilize the same. Foreigners, not Filipinos, became the beneficiaries of Philippine natural resources. This arrangement is clearly incompatible with the constitutional ideal of nationalization of natural resources, with the Regalian doctrine, and on a broader perspective, with Philippine sovereignty.
There can be little doubt that the WMCP FTAA itself is a service contract. Section 1.3 of the WMCP FTAA grants WMCP “the exclusive right to explore, exploit, utilise[,] process and dispose of all Minerals products and by-products thereof that may be produced from the Contract AreaThese contractual stipulations, taken together, grant WMCP beneficial ownership over natural resources that properly belong to the State and are intended for the benefit of its citizens.
These stipulations are abhorrent to the 1987 Constitution. They are precisely the vices that the fundamental law seeks to avoid, the evils that it aims to suppress. Consequently, the contract from which they spring must be struck down.
The Dec. 1, 2004 Reversal
CJ Panganiban speaking: We should reverse the Decision of January 27,
2004. The phrase agreements involving either technical or financial assistance, referred to in paragraph 4, are in fact service contracts.
But unlike those of the 1973 variety, the new ones are between foreign corporations acting as contractors on the one hand; and on the other, the government as principal or “owner” of the works.
In the new service contracts, the foreign contractors provide capital, technology and technical know-how, and managerial expertise in the creation and operation of large-scale mining/extractive enterprises; and the government, through its agencies (DENR, MGB), actively exercises control and supervision over the entire operation.
“Full control and supervision” by the State must be understood as one that does not preclude the legitimate exercise of management prerogatives by the foreign contractor.
In other words, the FTAA contractor is not free to do whatever it pleases and get away with it; on the contrary, it will have to follow the government line if it wants to stay in the enterprise. Ineluctably then, RA 7942 and DAO 96-40 vest in the government more than a sufficient degree of control and supervision over the conduct of mining operations.
Didipio Earth-Savers’ Multipurpose Assn., Inc., et al. vs. Elisea Gozun, et al., [G.R. No. 157882,Mar. 30, 2006]
Issues: Does R.A. 7942 & DAO 96-04 allow the
unlawful and unjust “taking” of private property for private purpose by permitting entry into a private property and allow taking of land without payment of just compensation?
Are service contracts allowed under the 1987 Constitution?
ON ISSUE NO. 1 The CAMC FTAA grants in favor of CAMC the
right of possession of the Exploration Contract Area, the full right of ingress and egress and the right to occupy the same.
It also bestows CAMC the right not to be prevented from entry into private lands by surface owners or occupants thereof when prospecting, exploring and exploiting minerals therein.
The entry referred to in Section 76 is not just a simple right-of-way which is ordinarily allowed under the provisions of the Civil Code.
The provision of the FTAA in question lays down the ways and means by which the foreign-owned contractor, disqualified to own land, identifies to the government the specific surface areas within the FTAA contract area to be acquired for the mine infrastructure.
The government then acquires ownership of the surface land areas on behalf of the contractor, through a voluntary transaction in order to enable the latter to proceed to fully implement the FTAA.
Eminent domain is not yet called for at this stage since there are still various avenues by which surface rights can be acquired other than expropriation.
ON ISSUE NO. 2 The mere fact that the term service contracts found
in the 1973 Constitution was not carried over to the present constitution, sans any categorical statement banning service contracts in mining activities, does not mean that service contracts as understood in the 1973 Constitution was eradicated in the 1987 Constitution.
The 1987 Constitution allows the continued use of service contracts with foreign corporations as contractors who would invest in and operate and manage extractive enterprises, subject to the full control and supervision of the State; this time, however, safety measures were put in place to prevent abuses of the past regime.
ISSUES & CONCERNS
Issues Affecting The Environment
The record of mining companies with regard to environmental protection, disasters and post-mining clean-up in the Philippines is widely acknowledged, even within the government, to be very poor.
As of 2003, at least 16 serious tailings dam failures in the preceding 20 years and over 800 abandoned mine sites have not been cleaned up. Clean-up costs are estimated in billions of dollars and the damage caused will never be fully reversed.[ A L Clark, (1994 ) The Phillippines Mineral Sector to 2010: Policy and Recommendations, Report to the Asian Development Bank on T.A. No 1894-PHI. East-West Center Honolulu, Hawaii, p360]
Modern mining in the Philippines typically consists of open-pit mining of low-grade ores for copper and gold, and strip-mining for nickel.
This involves flattening mountaintops, creating huge craters and producing vast amounts of waste in the form of tailings.
Large-scale gold mining is particularly destructive because it involves the processing of huge volumes of ground rock, using cyanide to separate gold from the ore.
The process also releases other potentially harmful toxic metals, the monitoring of which has been described as inadequate in certain mining operations in the Philippines. [Rapu-Rapu Finding and Recommendations of the Fact-Finding Commission on the Mining Operations in Rapu-Rapu Island, 19 May 2006, Executive Summary p15]
Large-scale mining has the potential to seriously exacerbate the problems on flooding, devastating landslides, siltation and the destruction of biodiversity areas as result of degradation of forests.
In the Philippines 81 per cent of the globally important land-based biodiversity areas are in forest habitats.
It is estimated that 37 per cent of this forest area may be opened up to new mining. [State of the Philippines Forest and Important Biodiversity Areas, Harribon Foundation , 27th July 2007]
Water contamination from mining poses one of the top three ecological security threats in the world. [USEPA]
Many mining applications in the Philippines are in water catchment areas very close to the sea, and pose a major threat to valuable marine environments.
In addition a number of companies are proposing to use submarine tailings disposal (STD) also referred to as deep-sea tailings placement.
The practice is effectively illegal in Canada and the United States and has never been proposed for use in Australia – the home countries of some 11 of the companies proposing STD in the Philippines.
www.miningwatch.ca/index.php?/Crew/STD_toolki
EIA processing timeframes have been reduced, with automatic approval if they are exceeded. Requirements to provide public information have been relaxed, as has the need to provide notice of public hearings.
These changes have been accompanied by relaxing of the controls in the Mining Act.
Taken together, they seriously undermine the protection afforded by EIAs in the Philippines.
Issues On Violations of Indigenous People’s Rights
The Indigenous Peoples Rights Act (IPRA, 1997) and the Mining Code (Republic Act 7942, 1995) guarantee indigenous peoples the right to free, prior, informed consent (FPIC) over decisions affecting them and developments on their lands.
FPIC is defined as: The consensus of all members of the ICCs/IPs [Indigenous Cultural Communities/Indigenous Peoples] to be determined in accordance with their respective customary laws and practices, free from any external manipulation, interference or coercion, and obtained after fully disclosing the intent and scope of the activity, in a language and process understandable to the community.
Lack of independent information regarding mining that is made available to IPs.
Information provided to IPs frequently amounted to little more than propaganda by mining companies.
Hence, IPs are not in a position to make an informed choice.
Two common themes during FFT discussions: (1) Lacked of respect for IPs traditional
cultures, viewing their right to FPIC as a technical obstacle to be overcome as quickly as possible rather than a necessary protection of rights; and
(2) Factionalism and misrepresentation.
CBCP Statement on Mining (Jan.29, 2006)
It is government mining policy of offering our lands to foreigners with liberal conditions while our people continue to grow in poverty.
The adverse social impact on the affected communities far outweigh the gains promised by mining Trans-National Corporations (TNCs).
The right to life of people is inseparable from their right to sources of food and livelihood. Allowing the interests of big mining corporations to prevail over people’s right to these sources amount to violating their right to life.
Mining threatens people’s health and environmental safety through the wanton dumping of waste and tailings in rivers and seas.
Deletion of the nationalist provisions in the Constitution can pave the way to the wholesale plunder of our National Patrimony, and undermine our Sovereignty.
Mining areas remain among the poorest areas in the country such as the mining communities in CARAGA, Bicol and Cordillera Regions. The cultural fabric of indigenous peoples is also being destroyed by the entry of mining corporations.
The CBCP calls on: Support to the struggle against all mining
projects, and raise the anti-mining campaign at the national level.
Closure of large-scale mining projects, for example, the Rapu-rapu Polymetallic Project in Albay, HPP Project in Palawan, Didippio Gold-Copper Project in Nueva Viscaya, Tampakan Copper-gold Project in South Cotabato, Canatuan Gold Project in Zamboanga del Norte, and the San Antonio Copper Project in Marinduque, among others;
Issues on Labor
2 million people working in the M&Q sector, most of whom fall in the bonded labor category. www.dalits.org/CasteRaceandWCAR.html
64% of all unorganized labour falls within the agriculture and mining sectors http://planningcommission.nic.in/midterm/english-pdf/chapter-08.pdf
The small mining and quarrying sector in South Asia is a repository of concentrated poverty and extreme forms of exploitation of the workers, both women and men. Mining work is commonly done on a contract basis, often at piece-rates, but also for daily wages.
Issues on Corruption
Large-scale corruption as one of the abuses typically associated with the extractive industry. [John Ruggie, Interim Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, U.N. Doc. E/CN.4/2006/97 (2006), Par. 25]
Dependency on natural resources is linked to high rates of corruption. [Legal Remedies for the Resource Curse. A Digest of Experience in Using Law to Combat Natural Resources Corruption. Open Society Justice Initiative 6 September 2005]
Other issues & concerns
Human Rights – Extractive industry worldwide has been described as having an ‘enormous and intrusive social and environmental footprint’. It has deplorable record in relation to human rights, resulting from militarization and corruption, and leading to a broad array of abuses ‘up to and including complicity in crimes against humanity’. [John Ruggie, Interim Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, U.N. Doc. E/CN.4/2006/97 (2006)]
Security Firms & Militarization –Members of the Subanon indigenous people reported that 169 armed security guards, hired by the TVI mining company,31 were manning checkpoints and blocking access to their ancestral domain. [Mining in the Philippines Concerns and Conflicts, Cathal Doyle, Clive Wicks and Frank Nally, July-Aug. 2006]
Pressures on Judiciary – Former Speaker De Venecia announced that, together with the Chamber of Mines ‘we mounted a strong campaign to get the Supreme Court to reverse itself. [Minesite.com Speech of Jose DeVenecia 17 June 2005, London]
Health Impacts - Cyanide separation is used to extract gold from ore. One-millionth of a gram of cyanide per liter of water can be fatal to fish. The mining process can also lead to toxic metals being released from the ore. If toxic metals, mercury or cyanide get into the food chain they can seriously damage health. www.greenpeace.org/raw/content/seasia/en/press/reports/cyanide-gold-mining-s-devasta.pdf
Response from DENR on Mining Issues
The current Philippine policy framework for mining is anchored on Republic Act No. 7942 or the Philippine Mining Act of 1995 and Presidential Decree No. 1586 or the Philippine Environmental Impact Statement (EIS) System.
PD No. 1586 or the Philippine Environmental Impact Statement (EIS) System ensures that environmental concerns are adequately addressed in all stages of project implementation. The EIS identifies potential environmental impacts from development activities like mining and provides for mitigative or ameliorative mechanisms to minimize or eliminate such impacts. It also sets out the process in obtaining social acceptability. www.denr.gov.ph
RA No. 7942 is considered as the primary tool to revitalize the mining industry but with equal emphasis on both social and environmental responsibilities. The revised rules and regulations implementing the Mining Act adopted the World Commission on Environment and Development’s (Brundtland Commission) definition of Sustainable Development as its governing principle and states that :"Mining shall adhere to the principle of sustainable development which meets the needs of the present without compromising the ability of future generations to meet their own needs, with the view of improving the total quality of life both now and in the future.“ [Ibid]
In our terms, mining shall alleviate rather than depress the economic conditions in the countryside; increase rather than decrease our mineral base through continuing mineral exploration; enhance rather than degrade the environment by managing the impacts of mining activities and the rehabilitation of mining affected lands to a productive state after mining and lengthen, through recycling and substitution, the usable life of mineral resources. [Ibid]
The minerals industry has been the primary tool in improving the quality of life of the people through the creation and amplification of wealth. Metals and other products of mining are in-dispensable components of the global economy.
The Philippines’ main resource base is its natural resources including mineral resources. The utilization of these resources, through a strong minerals industry, therefore, carries the great potential to advance the country’s economic growth. [Ibid]
Contrary to common belief that the grant of large tracts of land to mining contractors will result in massive land degradation, it should be emphasized that the grant of as much as 81,000 hectares for mineral exploration is subject to relinquishment.
Mineral exploration, to emphasize, is neither a land use nor a development activity but rather the scientific, non-destructive assessment of the mineral potential of the land that can possibly lead to a decision to mine. Mineral exploration is a high cost, high-risk endeavor without any guarantee of success. [Ibid]
Using the 81,000 hectares granted to an FTAA Contractor as an example, the contractor shall relinquish at least 25% of the original contract area after the second year of exploration and 10% each on the third, fourth and fifth years. Upon the end of the exploration period, the contractor shall retain only a maximum of 5,000 hectares or less per project area (or just 6.17% of the original contract area).
Exploration, however, does not always lead to mining. The odds of finding a mineral deposits is conservatively placed at 1:500, that is, for every 500 exploration projects, only one may be developed into a mine. [Ibid]
The decision to mine may come only after another 5 to 10 years, once all regulatory requirements and an exhaustive study of the mineral deposit had been undertaken. [Ibid]
Area Relinquishment during the Exploration Period
Land Classification in the Philippines
Case Study:The Marcopper Mining Disaster
The Marcopper Problem
For over 30 years, the Marcopper Mining Corporation has been operating on Marinduque Island in the Philippines.
The mine operations have caused innumerable troubles; serious health and environmental problems have placed the community at risk;
The island of Marinduque is a very poor area and relies heavily on agriculture and fishing. Mining in the area has polluted waterways, killed fish, and flooded agricultural fields;
Despite these negatives, Marcopper employs about 1,000 people, mostly from the island.
The corporation also provides $30 million a year for local goods and services, as well as the electricity for the province;
The island remains one of the poorest parts of the country.www.umich.edu/~snre492/Jones/marcopper.htm#Problem
The Rapu-Rapu Island Mining: Tragedy In Waiting
Right: Acid Mine Drainage (AMD) in the former Hixbar Mining area, Carogcog Saday (left) and Lafayette area in Pagcolbon (Above) in year 2000. Water is contaminated with lead and cadmium. Soil has very high arsenic content.
Upper picture was taken on December 12, 2005 while below was taken on February 5, 2006. The picture below that showed reddish coloration (pointed by yellow arrows) indicates AMD occurring within 2 months in this newly constructed protective structure purposely to hold back the downward movement of possibly contaminated tailings, silt, soil and water.
Mine tailings (see blue arrows) piled up in open dump in the Lafayette Mining area. These tailings are still contaminated with heavy metals such as arsenic, cadmium, lead and copper. They are also capable of generating acid mine drainage
Location of Barangay Malobago is pointed by a red arrow. Tidal movements and backflow of water current from Albay Gulf would tend to straighten the direction towards Pto. Diaz and other places in the eastern part of Sorsogon
The streak of reddish silt in the sea at Bgy. Malobago is pointed by an arrow
A sort of a small siltation pond where silted and possibly contaminated wastewater from the waste dam at upper elevation, is impounded. However, during heavy rains in November, 2005, one side of the rim (pointed by arrow) of this pond was destroyed and lowered to direct the flow of possibly contaminated water downhill. (Photo taken Nov. 12, 2005)
Broken rocks (pointed by arrow) indicate the remnant of destroyed part of the rim of the possibly contaminated pond. (Photo taken Nov. 12, 2005)
Outlet of the possibly contaminated
water originating from previous slide
and connected to existing creek in
the area
Final destination of the possibly contaminated water is the sea with direction going southward towards Sorsogon. (Photo taken Nov. 12,2005)
Conclusion
The Philippines is globally important as a centre of biological diversity. Additionally many poor people depend on the environment and its bounty to sustain their lives.
The economic, cultural and spiritual potential of Philippine biodiversity for the future of the nation and especially its poorest citizens, should be given priority in planning for the future.
Recommendations
I. All current mining applications which will inevitably cause major environmental damage to critical watersheds, ecosystems, agriculture or fisheries and result in social disruption should be required to adopt best international practices.
Best International practice requires: 1. That mining licenses should not be issued in
conflict zones as recommended by the Extractive Industry Review.
2. The adoption of the precautionary approach to mining as required by the Rio Declaration. This would require a ban on submarine and riverine tailings disposal and marine mining.
3. That no further mining licenses should be issued until adequate enforceable legislation and controls are put in place to protect the environment and the economic, social, cultural, civil and political human rights of the indigenous peoples mining impacted communities and the needs of future generations.
II. All relevant government agencies should confine their activities to the impartial regulation of mining.
The current trend towards self-regulation is inappropriate to the potential seriousness of mining impacts.
The shift of government from ‘regulator of mining’ to ‘active promoter of mining’ sets up a conflict of interest which tends to undermine confidence in the impartiality of government agencies, especially at the community level.
III. Revoke or amend R.A 7942 and enact alternative legislation to regulate mining, based on a participatory process that more effectively protects the interests of the affected local communities, indigenous peoples and the environment.
IV. Establish a credible independent mining review body and subject all recently granted mining licenses under the 1995 Mining Code to a credible independent review, involving civil society and affected communities in the process.
V. Sign up to the Extractive Industry Transparency Initiative (EITI) and publish details of all payments, taxes and royalties made by mining companies.
Implement EITI in accordance with the six EITI criteria.
The EITI is a coalition of governments, companies, civil society groups, investors and international organizations.
It aims to strengthen governance by improving transparency and accountability in the extractives sector
Six EITI criteria
Regular publication of all material oil, gas and mining payments by companies to governments (“payments”) and all material revenues received by governments from oil, gas and mining companies (“revenues”) to a wide audience in a publicly accessible, comprehensive and comprehensible manner.
Where such audits do not already exist, payments and revenues are the subject of a credible, independent audit, applying international auditing standards.
Payments and revenues are reconciled by a credible, independent administrator, applying international auditing standards and with publication of the administrator’s opinion regarding that reconciliation including discrepancies, should any be identified.
This approach is extended to all companies including state-owned enterprises.
Civil society is actively engaged as a participant in the design, monitoring and evaluation of this process and contributes towards public debate.
A public, financially sustainable work plan for all the above is developed by the host government, with assistance from the international financial institutions where required, including measurable targets, a timetable for implementation, and an assessment of potential capacity constraints.
VI. Precautionary Principle should be applied to any mining or other high impact development to ensure it only proceeds where there will not be significant negative impact on the lives of the preexisting population or on the environment.
VII. Health impact assessments should be performed and information provided to communities in advance of mining operations. Monitoring on the basis of these base line studies should be conducted in the vicinity of all mining sites, and companies held accountable for any negative effects observed.
Companies should be required to provide a bond against potential health impact.
VIII. Increase efforts to stamp out the spate of killings of politically active citizens and
prosecute the perpetrators. Independent investigation and the potential
assistance should be sought and to be provided for this by the UN system through the input of the UN Human Rights Special Rapporteurs, were they invited to visit and report.
IX. Ratification of UN Declaration on Indigenous Peoples Rights and International Labour Organization Convention (No. 169)X. In line with the 1987 constitutional recognition of prior indigenous peoples’ rights to their ancestral lands, government should end the contradictory practice of allowing the proposition that mining companies can assert prior rights claims over indigenous peoples (the traditional owners/occupiers of the land) ancestral lands .
Thank YouMay Our Children Inherit The Bowels Of Our Land
