Non-compliant mining firms face closure

Published April 25, 2018, 12:00 AM

by manilabulletin_admin

By Madelaine B. Miraflor

Soon enough, there will be another reason for the country’s highly challenged mineral sector to be more cautious.

This, as the government said it will not hesitate to shutdown or suspend companies that will fail to follow the new Department of Environment and Natural Resources (DENR) order which forces mining companies to start their rehabilitation efforts even if their operations are still taking place.

Environment Undersecretary Jonas Leones said the DENR’s Department Administrative Order (DAO) on progressive rehabilitation will be finally signed by Environment Secretary Roy Cimatu in the early part of May.

Environment Secretary Roy Cimatu
Environment Secretary Roy Cimatu

Non-compliance of the order — which would be applicable to all mining operations, even the existing ones that already have feasibility studies — can result to suspension and closure, he said.

Under the DAO, if a miner is producing 1 million metric tons (MT) or less, they can only operate within 50 hectares of their mine site. If their production goes around 1 million to 3 million MT, miners are only allowed to operate within 60 hectares of their tenements, while those producing 3 million to 5 million MT can only excavate within 70 hectares of its contract area.

To oppose some provisions in the DAO, the Chamber of Mines of the Philippines (COMP), the organization of some of the country’s largest mining companies, has earlier submitted its comments to the DENR, which are now being reviewed by the agency.

This was confirmed by a source from the DENR, who said some provisions in the DAO “didn’t sit well” with miners, especially those with existing large-scale operations since they already have a detailed plan that they are executing.

Once implemented, the DAO will force these companies to make major adjustments in their operations as well as start their rehabilitation efforts way earlier than they are supposed to be.

Based on the existing laws, miners are only required to implement their final mine rehabilitation or decommissioning plan at least five years prior to the end of their mineral agreements, which normally have a term of 25 years.

Leones said the DAO “doesn’t violate the rights of the miners” because “in the first place, they are required to rehabilitate and that the new order is just requiring them to adjust it.”

“They really have to adjust,” Leones said. “This order really intends to cause a shake-up the industry.”

“In the previous guidelines, no provisions tell the miners where they can operate. Their rehabilitation only comes at the end of their rehabilitation that’s why mine sites normally looked bad,” he added.

Meanwhile, Nickel Asia Corporation (NAC), the country’s largest nickel producer, is unfazed by the new order, saying that it will not impact its production volumes.

“NAC’s two largest operations, Taganito and Rio Tuba, both supply ore on long term supply arrangements to NAC’s two affiliate domestic processing plants, Taganito HPAL and Coral Bay. The proposed Administrative Order provides for larger mining areas to mining operations supplying ore to domestic processing plants. Of its two smaller operations, its Cagdianao mine is within the maximum allowable area while its Hinatuan operation will be able to maintain its production volume within the allowable mining area,” NAC explained.

Based on the DAO, miners with mineral processing plants are allowed to work on 162 hectares of their contract area.