DENR order to cause P66-B annual loss, mass layoff

Published February 3, 2017, 10:00 PM By Madelaine B. Miraflor

http://business.mb.com.ph/2017/02/03/denr-order-to-cause-p66-b-annual-loss-mass-layoff/

Miners had sought for the support of President Rodrigo Duterte’s economic team to overturn the decision of Environment Secretary Gina Lopez to padlock more than half of the operating mines in the country and suspend five of them.

A day after Lopez announced the long-delayed result of her nationwide audit on mining companies, Chamber of Mines of the Philippines (COMP), which is comprised of the country’s biggest miners, wrote to Finance Secretary Carlos Dominguez, seeking for possible intervention.

COMP particularly called on the Mining Industry Coordinating Council (MICC), co-chaired by the Department of Finance (DOF), to convene and review the policies and arbitrary actions of Lopez.

The organization believes that the drastic action of the Department of Environment and Natural Resources (DENR) of publicly announcing the closure and suspension of 28 mining operations without due process will have detrimental and far-reaching impacts on the economy, the mining industry, and the country.

For one, it could cause the mining industry to suffer from an annual loss of R66 billion in profits, based on COMP data.

“We have been supportive of government’s policies and programs as investors. We feel there is an urgent need for convening the MICC to look into the basis of the arbitrary mine closure and suspension orders which we believe was undertaken without due process,” COMP Chairman Artemio Disini told Dominguez in a letter.

“Being one of the members of the economic team of the President, you will be more in a position to see the likely implications of the closure and suspension and the impacts it will bring about in the basic services and livelihood programs provided in the communities,” he added.

Meanwhile, COMP Vice President for Legal and Policy Ronald Recidoro said that some of the affected miners will definitely seek legal action if Duterte would just ignore their appeal to counter Lopez’s decision.

To recall, Duterte expressed his support to the Lopez’s decision on the same day she announced the result of the audit.

In its final list, it turned out that instead of 21 mines like it earlier said, the DENR closed down 23 mining firms and suspended five companies.

The companies that were suspended were Berong Nickel Corp., Citinickel Mines and Development Corp., Lepanto Consolidated Mining Corp., OceanaGold Phils., and Strong Built Mining Development Corporation.

Those that are for closure are Benguet Corporation, Ore Asia Mining and Development Corporation, BenguetCorp Nickel Mines, Inc., Eramen Minerals, Inc., Zambales Diversified Metals Corporation, LNL Archipelago Minerals, Inc., Mt. Sinai Mining Exploration and Development Corp., Emir Minerals Corp., TechIron Mineral Resources, Inc., AAMPHIL Natural Resources Exploration, Kromico, Inc., SinoSteel Philippines H.Y. Mining Corp., Oriental Synergy Mining Corporation, Wellex Mining Corporation, Libjo Mining Corp., Oriental Vision Mining Phils. Corp., ADNAMA Mining Resources Corp., Claver Mineral Development Corp., Platinum Development Corp., CTP Construction and Mining Corp., Carrascal Nickel Corp., Marcventures Mining and Development Corp. and Hinatuan Mining Corporation.

The DENR has yet to issue its decision for Filiminera Resources Corp.

Among these firms, COMP members are Benguet Corp., Eramen, LNL Archipelago, Platinum Group Metals, CTP Construction, Marcventures Hinatuan Mining, Filminera, Oceana Gold and Lepanto.

“Mining companies were invited by government to invest in the Philippines and signed contracts with them as partners in mineral resource development. By entering into these contracts, government is bound to observe due process. Secretary Lopez cannot just shut down mines without due process,” Disini said.

According to him, the planned closure of 23 Philippine mines, mostly nickel producers, and the suspension of five others will affect about 1.2 million people.

“We have a total of 1.2 million people affected including family members,” Disini said.

Enrique Fernandez, president of suspended nickel miner Eramen Minerals, Inc., which has also been ordered to shutdown, said from 1,000, their staff levels had already fallen to 150.

“By the end of the month, we might have to let go of some more,” Fernandez said.

“The problem is the relationship between the government and the industry. The government is more of a regulator rather than a partner in development,” he added.

The DENR is yet to provide the recommendation reports of Mines and Geosciences Bureau (MGB) — tasked to review the initial reports of the audit — for each mining companies that were recommended for suspension.

When asked for them, Lopez declined to provide them, saying the reports of MGB is in contrast with the decision of DENR.

This led COMP to think that Lopez’s decision “may not have been even based on the review conducted by MGB.”

Vicente Lao, who owns chromite producer Mt. Sinai Mining Exploration and Development Corp., which has also been ordered to close down, said Lopez took it upon herself to be the judge and the executioner of the mining industry.

“I am in no obligation to let you know what’s happening here,” Lopez earlier told reporters. “But  MGB has been really really slow and I’m not happy with them at all. MGB just recommends and at the end of the day, I make the decision”.

“If I’m not happy with it (MGB’s recommendations), why would I give it to you? If I don’t agree with it, why would I give with you? I don’t want to show you the recommendations whatever reasons there may be,” she added.

On Friday, the Philippines Stock Exchange halted the trading of several mining shares, involving listed mining companies and their subsidiaries that were either suspended and closed down by the DENR. This includes nickel ore producers Nickel Asia Corp. and Marcventures Holdings Inc.

The Philippines is the world’s top nickel ore supplier yet the mining sector still contributes less than 1 percent to the economy.

Lopez said she “doesn’t care” about the growth of the country’s Gross Domestic Product (GDP) as long her fight for social justice is intact.

“Social justice..Whatever that means. You are looking at fairy tail situation, which never happens even in an industrialized country,” Nelia Halcon, COMP executive vice president, also said on Friday.