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20 more mines face suspension

Posted on September 28, 2016

THE Environment department has identified 20 more metal mines that face suspension for various infractions under a nationwide audit that began in July, which if added to 10 earlier halted would comprise nearly three-fourths of 41 such facilities spread across the country.

Bloomberg reported after the announcement that nickel surged as much as 2% to $10,745 a metric ton (MT) on the London Metal Exchange, the highest since Aug. 12, and traded at $10,675 at 10:50 a.m. in London, recovering from a 2.7% loss. Last month, prices surged to $11,030/MT as the audit got under way, the highest in a year.

The Philippines is the world’s biggest producer of nickel -- which is widely used in construction and electronics -- and accounts for more than 90% of China’s nickel ore imports.

“Twenty need to get their act together,” Environment Secretary Regina Paz L. Lopez told reporters in a press conference at the department’s head office in Quezon City.

“The mining companies will be given seven days to answer and then a final decision will be made.”

If the additional mines recommended for suspension were halted, it would bring to 30 the number closed, 18 of them nickel producers that account for 55.5% of the country’s total nickel ore output based on last year’s production.

The 10 mines whose operations were suspended earlier belonged to Benguet Corp. Nickel Mines, Inc.; Berong Nickel Corp.; Citinickel Mines and Development Corp.; Claver Mineral Development Corp.; Emir Mineral Resources Corp.; Eramen Minerals, Inc.; LNL Archipelago Minerals, Inc.; Mt. Sinai Mining Exploration & Development Corp.; Ore Asia Mining and Development Corp. and Zambales Diversified Metals Corp.

The country produced 467,000 MT of nickel last year, 24% of the global mined total of 1.93 million MT, according to a quarterly report from Morgan Stanley. There was a cumulative global deficit 42,500 tons in the first seven months of the year, the International Nickel Study Group said in September.

Environment Undersecretary Leo L. Jasareno told reporters in the same briefing that the department will start sending out reports of the audits today to affected mining firms with letters asking them to explain in writing why their operations should not be halted.

He urged them to “hurry up mitigating measures” in order to resolve problems that warrant suspension orders “in no time.” Such issues include lack of tree cutting permit, unregistered facilities for treatment, incorrect storage and disposal of tailings, causing discoloration of coastal waters and abandoned open pit, among others.

The additional mines now facing suspension belong to AAMPHIL Natural Resources Exploration and Development Corp. (Parcels 1 and 2B); Adnama Mining Resources, Inc.; Agata Mining Ventures, Inc.; Benguet Corp.; Carrascal Nickel Corp.; Century Peak Corp. (Casiguran Nickel and Rapid City Nickel projects); CTP Construction and Mining Corp.; Hinatuan Mining Corp.; Krominco, Inc.; Filminera Resources Corp./Philippine Gold Processing and Refining Corp.; Lepanto Consolidated Mining Co.; Libjo Mining Corp.; Marcventures Mining and Development Corp.; OceanaGold Phils., Inc.; Oriental Synergy Mining Corp.; Oriental Vision Mining Philippines Corp.; Sinosteel Philippines H.Y. Mining Corp.; Strongbuilt Mining Development Corp.; Wellex Mining Corp. and SR Metals, Inc.

“On Thursday at 11 (AM) I would like to meet all the mining companies that have, in quotation marks, failed the audit, so we can talk and we can let them explain,” Ms. Lopez said, adding that she also would like to meet those miners who “in quotation marks passed.”

The mining and oil sectoral index joined the rest of the bourse in sounding retreat yesterday, but it suffered the biggest fall of 2.44% to end at 10,628.34.

The remaining 11 metal mines found with infractions that were “not compelling enough” to warrant suspension belonged to: Apex Mining Company, Inc.; Cagdianao Mining Corp.; Greenstone Resources Corp.; Intex Resources Philippines, Inc.; Pacific Nickel Philippines, Inc.; Philex Mining Corp.; Philsaga Mining Corp.; Platinum Group Metals Corp.; Rio Tuba Nickel Mining Corp.; Taganito Mining Corp. and Techiron Resources, Inc.

“They have been really much better than the others,” Ms. Lopez said adding that she would also like to meet with them on Thursday to discuss her plans of pushing environmental standards to a higher level.

Jose Bayani D. Baylon, Nickel Asia’s vice-president for corporate communications, said that once the letter is received, subsidiary Hinatuan “will definitely show cause as to why it does not merit being suspended.”

SR Metals said it would await the formal notice, adding in an e-mail: “We are confident that the two issues raised by Usec. Jasareno, particularly access to the provincial road and new municipal resolution, will be clarified.”

OceanaGold President and Chief Executive Officer Mick Wilkes said in a statement posted on the firm’s Web site: “We are disappointed with the statements made earlier today and will seek clarification and reconsideration from the DENR [Department of Environment and Natural Resources] to further understand and rectify this matter in short order.”

Benguet Corp. aruged it remains committed to rehabilitate its Antamok mine in Benguet, saying in a statement: “While the company recognizes there was delay in the rehabilitation of the open pit for reasons beyond its control, it has not abandoned it.”

The Chamber of Mines of the Philippines (COMP) also lamented the mine audit results.

“We stand by our member-companies. We are optimistic that these alleged violations will be addressed properly and in a timely manner,” said Ronald S. Recidoro, vice-president of the COMP’s Legal & Policy Division, in the statement.

COMP has earlier raised concerns on the inclusion of anti-mining civil society organizations in the audit teams which it said made the process “not totally impartial”, calling for the DENR to conduct such reviews in the future on its own.

Mr. Jasareno said that the department is mulling to do the audit “periodically” but has not discussed on how regular such assessment should be.

Once done with the audit, which will take two more weeks to come up with final decisions, the department may start similar reviews of all quarrying and the country’s 65 non-metal mines. -- Janina C. Lim with Bloomberg and Reuters inputs