The first six months of the year have been good to the Philippines’ mining sector, with strong metal prices pushing the value of metals output up to P68.63 billion and gold and nickel, which account for most of the country’s mineral production, registering higher output from January to June.
And Mines and Geosciences Bureau (MGB) believes things will only get better from here as the sector awaits the entry of new players in the next few months, following the implementation of Executive Order (EO) 130, which lifted the ban on new mining projects.
Based on MGB’s latest data, metallic mineral production value advanced by 24.50 percent in the first six months of 2021, from P55.13 billion in the same period last year to P68.63 billion.
The government agency attributed this to the continued strong metal prices during the period. To be specific, prices of base metals, copper, and nickel grew by 65 percent and 40 percent, respectively. Likewise precious metals, gold, and silver went up by 10 percent and 59 percent, respectively.
In terms of contribution to the metallic production value, nickel together with its nickel products accounted for 53.44 percent or P36.68 billion, followed by gold with 34.84 percent or P23.91 billion. Copper took the third spot at P7.46 billion or 10.87 percent, while the collective values of silver, iron ore, and chromite were less than 1 percent or P580 million.
However, only gold and nickel had registered growth in output, while the rest – including silver, copper, chromite, and iron – all recorded lower production.
To be specific, nickel, together with its nickel products, continued to rule the production scene, contributing more than 53 percent of the country’s production value. Breaking it down further, nickel direct shipping ore accounted for 58 percent or P21.42 billion, while mixed nickel-cobalt sulfide tendered 41 percent or P15.07 billion.
Nickel ore production volume particularly went up by 39 percent from 109,471 metric tons (MT) to 151,646 MT. This, while prices of nickel are at their sweetest at US$17,490.15 per MT from US$12,473.17 per MT, year-on-year, a considerable price difference of US$5,017 per MT.
The top three producers for the first half were Taganito Mining Corporation (TMC) with 28,935 MT, followed by Rio Tuba Nickel Mining Corporation (RTNMC) with 25,301 MT and Platinum Group Metals Corporation with 12,977 MT.
The production volume of the yellow metal, on the other hand, was up by 3 percent from 8,257 kilograms to 8,545 kilograms.
Meanwhile, copper production volume went down from 31,030 MT to 23,557 MT year-on-year, a difference of 24 percent, while silver declined by 6 percent from 11,793 kilograms to 11,069 kilograms year-on-year.
Moving forward, MGB expects the mining industry to perform better on the back of recent policy decisions in the sector, including the issuance of EO 130, which lifted the ban on new mining projects.
“Recent developments in the local minerals industry are anticipated to be game-changers in the overall performance of the industry in the coming years not only in terms of mine ore production but also in its economic contribution,” MGB said in a statement.
“By this, we mean employment generation, increased revenue collection both at the local and national level, and improved quality of life of the host and neighboring communities. Latest developments include the re-entry of Didipio Copper-Gold Project of OceanaGold (Phils) Inc. (OGPI) in Nueva Vizcaya to the production stream and the issuance of EO 130,” it added.
The renewal of the OGPI’s Financial or Technical Assistance Agreement (FTAA) was approved only in July, and is projected to augment the country’s copper, gold, and silver mine production.
EO 130, on the other hand, already took effect recently after the issuance of implementing rules and regulations (IRR). This EO amended Section 4 of EO No. 79 of 2012 wherein the Government may now enter into new mineral agreements, subject to compliance with the Philippine Mining Act of 1995 and other applicable laws, rules, and regulations.
Data from MGB showed that of the 30 million total land area of the Philippines, only about 2.55 percent or 763,899.75 hectares is covered by mining tenements. Breaking it down further, of the 9 million hectares identified as having high mineral potential only 8.49 percent is covered by mining tenement.
“This significantly means that 91.51 percent of the land area identified with high mineral potential remains to be untapped,” MGB said.
Nevertheless, MGB remains cautious about the global trends that may affect the mining industry in the next few months.
“The COVID-19 pandemic is still very much on the scene affecting mining operations worldwide, even major players were not spared,” MGB said.
“Reduced economic activities would mean the demand for industrial metals like copper, iron ore, nickel, and among others being utilized by the steel, construction and other downstream industries to decline. Mineral analysts are also projecting demand cutback from China, for these metals. China is the country’s major trading partner when it comes to its mineral ores,” it added.