15 mining exploration projects await TRAIN 2

By Jonathan L. Mayuga -December 28, 2018

https://businessmirror.com.ph/15-mining-exploration-projects-await-train-2/

AT least 15 mining exploration projects look forward to the enactment of the second phase of the Tax Reform for Acceleration and Inclusion, or TRAIN 2, to proceed to the development and construction phase, an official of the Department of Environment and Natural Resources (DENR) said.

DENR Undersecretary for Climate change and Mining Concerns Analiza R. Teh said TRAIN 2 satisfies the requirement under Executive Order (EO) 79 as it puts in place a new fiscal regime for mining, which could possibly pave the way for the lifting of the six-year-old moratorium for new mining projects.

There are currently 48 operating metallic mines in the country, including eight gold mines, three copper mines, 30 nickel mines, three chromite mines and four iron mines.

Mining investment, including actual mineral production, slowed down since EO 79 was put in place in July 2012, owing to the atmosphere of uncertainty and the ensuing wait-and-see attitude demonstrated by the mining industry’s big players.

This worsened following President Duterte’s appointment of anti-mining advocate Regina Paz L. Lopez as environment secretary, followed by a 10-month crackdown against large-scale mining companies.

Under the current DENR leadership, mining industry’s big players, represented by the Chamber of Mines of the Philippines (COMP), expressed “guarded optimism” and had moved to reverse what they described as anti-mining policies, including the moratorium on new mining projects.

With 15 mining projects going on stream, the country’s annual mineral production output is expected to increase.

The members of the Mining Industry Coordinating Council (MICC), in a meeting last December 12, are in agreement that the enactment of TRAIN 2 satisfies the requirement of EO 79 for the possible lifting of the moratorium for new mining projects.

Once the moratorium is lifted, the DENR, through the Mines and Geosciences Bureau, can start issuing mineral production sharing agreements and financial and/or technical assistance agreements for new mining projects.

Teh said the first phase of TRAIN, which increased mining excise tax from 2 percent to 4 percent, was not enough to lift the moratorium for new mining projects.

“There was an MICC meeting in December. There are exploration permits about to end but because there is a moratorium under EO 79, we posed the question to the MICC if the 4-percent excise tax under TRAIN is enough, the DOF said the complete package will come under TRAIN 2,” she said.

The House of Representatives has transmitted its version of TRAIN 2 to the Senate. Teh said, based on information she got from the MGB, 15 mining projects in the exploration phase are maturing.  But these projects may have to wait until the proposed measure is finally signed into law.

Upon satisfying all requirements under Republic Act 7942 or the Philippine Mining Act of 1995, a project may then proceed from exploration, the first phase of the project, to the development and construction phases.

However, Teh clarified the DENR has yet to resolve the controversial ban on open-pit mining method.

“Of course, there’s still the issue about open-pit.  Another possible restriction is if the company is being investigated for other violations,” she said.

The ban on prospective open-pit mining applies only to select ores – including gold, copper, silver and complexed ores, although some mining companies have appealed to have the open-pit mining ban revoked.

Teh said the MGB will continue to conduct an assessment whether a mining company may proceed to the development and construction phase upon successfully conducting the feasibility of the mineral potential of the area they applied for.

“Of course, a positive factor to be considered is the contribution to the economy and employment,” she said.