ATM Policy Paper on Mining in the Philippines

Alyansa Tigil Mina

2011

Prepared by

Alyansa Tigil MinaSeptember 2011

Photos by Farah Sevilla, Jay Azucena, Denise Fontanilla & Bro. Martin Francisco

Alyansa Tigil Mina 1

Updated September 2011*

Summary

The economic cluster of the Aquino administration has adopted the misplaced policy of the previous adminsitration to revitalize the Philippine industry. Despite the numerous studies done recently showing that mining has not contributed significantly to the Philippine economy, mining has been included in the industrial priority list (Arangkada 2011), and the Medium Term Philippine Development (ironically, under Chapter 10: Environment and Natural Resources). It is ATM’s position that such policies are inconsistent with President Aquino’s Social Contract with the Filipino People.

The performance of the Philippine mining industry is dismal. It failed to deliver on its promises on revenues, investments and employment. Its contribution to the Philippine economy is relatively insignificant compared to Agriculture, Fisheries and Forestry. Adding tourism to the equation (whose operations are directly impacted by mining), then you have an imbalance.

There are evidences that describe the seriousness of issues lodged against large-scale mining. These include threats to gains in asset reform, physical displacement and cultural dislocation of indigenous peoples, destruction of biodiversity, inconsistency with the new laws on climate change and disaster risk reduction, escalation of

2 2011 Position Paper on the Revitalization of the Philippine Mineral Industry Policy

social conflicts and human rights violations, undermining of local autonomy, weak governance and regulatory mechanisms, and the myth of responsible mining. These threats are more than enough to counter-balance the claimed benefits of large-scale mining, and will possibly result in negative net benefits to the communities and the country. The proposal to stop mining operations in protected areas is a welcome initiative. However, it is easy to legally comply with this, because National Integrated Protected Areas System Law (NIPAS or RA 7586) defines “protected areas” as those declared by the President or Congress. We argue that there is mining in areas of high biodiversity, critical watersheds and natural forests, that have not been declared by the President or Congress, and thus are not legally defensible if such an Executive Order will be pushed.

ATM recommends that the Aquino administration drops the policy on mining revitalization and immediately revoke Executive Order 270-A. The government must also adopt a “Cost-Benefit Analysis” in all mining projects. In the absence of such, certain areas of the Philippines must be declared as “No-Go Zones”. Enforcing the Mining Act of 1995 has been problematic, and given its inherent flaws, a new minerals management law must be enacted. A rational and needs-based mineral policy must be put in place in the interim, anchored on a National Industrialization Plan. In all cases, the rights of indigenous peoples, just and equitable sharing of benefits, and the principles of local autonomy must always be protected and upheld. Finally, the government must ensure that transparency and accountability are firmly embedded in the mining industry and govenment agencies.


The current policy and its claimed basis

The Philippine Mining Act of 1995 (RA 7942) is the national legislation regulating the mining industry in the Philippines. EO 270-A was signed last September 2004, establishing the revitalization of the Philippine mineral industry. In effect, the Philippine government has shifted its policy from “tolerance” to “aggressive promotion” of the mining industry. Thirty-two (32) priority large-scale mining projects have been pipelined since then, aside from more than two thousand applications for mining contracts and exploration permits. Relatedly, government has put its support to the mining industry in terms of i) fast-tracking the application and permission process, ii) watering down the consent process for indigenous peoples, iii) weakening local autonomy of local governments to resist or oppose the entry of large-scale mining in their territories, and iv) highlighting mining as a priority in the Medium Term Philippine Development Plan (MTPDP: 2004-2010).

The Arroyo administration based this policy shift on the claimed economic benefits dangled by the mineral industry. There was pervasive belief in the previous administration that a revitalized mining industry will bring in significant investments, emplyment and revenues. The promises have included i) US$5-7 billion dollars in foreign exchange generation, ii) Php5-7 billion pesos in excise tax colletion, iii) 239,000 indirect and direct employment, and iv) US$4-6 billion dollars worth of investments.

The Department of Environment and Natural Resources (DENR) has been confronted with a conflicting role. On one hand, its main task is to ensure conservation, protection and rehabilition of biodiversity areas. However, it is also expected to manage and regulate utilization of natural resources and is required to implement the mining policies.

Amidst the backdrop of an attempt to sell the idea of “sustainable mining”, the Philippine government equipped the mining revitalization policy with the National Minerals Action Plan (NMAP). Through the NMAP, the Philippine mining industry was depicted as compliant with the sustainable development framework by identifying social development, environmental mitigation and economic benefits as a convergence framework. However, as international opinion was consistently debunking the concept of “sustainable mining”, the Philippine government had to fall back on the concept of “responsible mining”. Responsible


mining, as showcased by the Chamber of Mines of the Philippines (COMP) espoused “best practices” reflecting the key elements of: i) compliance with the principles of sustainable development, ii) built-in protection for indigenous peoples, iii) ensuring shared benefits of mining to major stakeholders, and iv) compliance with strict environmental and social provisions.

Performance of the revitalized mining policy

In a Philippine Institute for Development (PIDS) discussion paper, it stated that in an 18 year period (1990-2008), the percent share of Employment in the Mining and Quarrying Sector to Employment in All Industries never went higher than 0.65%. The highest figure was recorded in 1990. In the same period, the total employment in mining and quarrying in any given year never exceeded more than 160,000.1 It is important to note that these figures capture both mining and quarrying. It is logical to expect that if only figures for quarrying were not factored in, the total number of employment for mining alone, would be significantly lower. The same paper found that the knowledge base of the country needed to pursue national industrialization strategy is poor. It concluded that “judging by experience, the search for national industrialization in the mining sector would be a difficult… However, [this] should not prevent the country from attempting once again especially given the importance of industrialization to the growth of the economy.”2

The gross production value in mining rose from US$568.7 million in 2001, to a high of US$912.4 million in 2005. However, total payments to government during this period averaged only 4.64 % of gross production value – in stark contrast to the statements referring to wealth generation and wealth sharing. Although the production value of mining rose steadily over the period, the share going to local government plummeted to 0.19 % of gross production value in 2005, and a measly 5.5 % of the total tax take. This is a far cry from the ‘fair’ share that the national government has promised.3

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There is evidence that undercollection of taxes in the mining industry was between 60% to 80% from 1997-2008, a period of 13 years. It was also observed that poor revenue collection from mining was recorded for the period 1997 to 2009. The average revenue effort for the Philippines for the period was 15.9%, and for the

mining industry, it was only 9%! Collection of taxes at the LGU level was also dismal. The average revenue collection from 1997-2000, was only 5%. From 2001-2009, this average has gone down to 0.7%!4 In the case of Marinduque, Marcopper Mining Corporation has an outstanding balance of unpaid real property taxes for the period of 1980 to 2006 alone of more or less ONE BILLION PESOS due to the LGUs of Boac, Mogpog, Sta. Cruz, Torrijos and the province.

Despite the commitments in the previous MTPDP (2004-2010) and the NMAP, the resolution of the Marcopper mine tailings spill, the rehabilitation of the Mabatas Tailings Dam and the rehabilitation of seven abandoned legacy mines remain undone.

Serious issues and concerns on the revitalized mining policy

1. Large-scale mining poses serious threats to asset reform gains. It displaced and continues to displace indigenous peoples from their ancestral domains under the Indigneous Peoples Rights Act (IPRA or RA 8371) and small farmers under the Comprehensive Agrarian Reform Program (CARP). In fact, the displacements of indigenous peoples and farmers have been heightened. PhilDHRRA reported in 2008 that more than half of ancestral domains of indigenous peoples are directly impacted by mining and logging applications or operations. Moreover, the study revealed that 72% of these extractive activities (mining and logging) located within ancestral domains operate without securing free prior and informed consent (FPIC) from indigenous peoples.5

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The government have spent billions of pesos of public and private funds on the above mentioned asset reform program and it is but right to sustain the gains from these programs. Concerned government agencies in charge of processing large-scale mining application should seriously consider it. Displacement would affect not only the future of the families displaced but also the country’s food security and sovereignty.

Concrete cases include the resistance of farmers in Calatagan, Batangas, in the forced entry of Asturias Chemical Industries. An estimate of more than a hundred farmers, working productively in about 500 hectares of farmlands, are opposing a limestone mining operations. These farmers are beneficiaries of the CARP, and have fully paid their amortizations to the Land Bank.

2. Mining negatively impacts indigenous peoples. Despite the safeguards provided by IPRA, the IPs are marginalized in the fight against mining because the free, prior and informed consent is routinely violated by mining companies. Cases of misinformation, subtle bribery, intimidation and even harassment have been documented. Even if royalty payments are successfully negotiated, the assurance that communities will receive equitable and just share in these benefits are not assured.

In 2002 and 2003, Rodolfo Stavenhagen, United Nations special rapporteur for the human rights and fundamental freedoms of indigenous peoples visited the Philippines and reported: “Of particular concern are the long-term

devastating effects of mining operations on the livelihood of indigenous peoples and their environment. These activities are often carried out without their prior, free and informed consent, as the law stipulates. Communities resist development projects that destroy their traditional economy, community structures and cultural values, a process described as development aggression. Indigenous resistance and protest are frequently countered by military

force involving numerous human rights abuses, such as arbitrary detention, persecution, killings of community representatives, coercion, torture, demolition of houses, destruction of property, rape, and forced recruitment by the armed forces, the police or the so-called paramilitaries.”

In Oriental Mindoro, the Mangyans in the towns of Pola, Socorro and Victoria are opposing the entry of Intex Mining Corporation, a Norwegian mining company. The resistance is multi-sectoral, including LGUs, farmers, fishers, women, professional, the religious and academe. It culminated in a hunger


strike last November 2009, that successfully revoked the Environmental Compliance Certificate (ECC) of Intex, wrongfully issued by the DENR. The proposed mining area was within the ancestral domains of the Mangyans, and they have categorically denied the mining company their free, prior and informed consent.6

Recent struggles of IPs against mining include the Palaw’an tribe of Southern Palawan versus mining company MacroAsia Corporation who claims to have undergone the process of free prior and informed consent, when the real tribal warriors and leaders are publicly against mining in their ancestral land. (This is further discussed in the next item.)

Meanwhile, killings and human rights abuses against anti-mining communities also continue to rise. Florita Caya, General Manager of the Unified Tribal Council of Elders (UTCEL) was shot on April 27 this year. Their organization, a group of indigenous peoples (Mandaya, Manobo, Mangguangan and Dibabawon) in Monkayo, Compostela Valley, were engaged in protecting their ancestral lands against large scale mining and logging. UTCEL members said that prior to her death, Caya has received threats urging them to stop their activities, especially in their advocacy against mining.


The negative impacts of large-scale mining to indigenous peoples were also documented by a report produced by the London-based Working Group on Mining in the Philippines (WGMP). The report stated that IPs “are particularly vulnerable to the negative effects of mining. The ancestral domains of indigenous communities tend to be in forested upland areas, many of which are now targeted by mining corporations. Stewardship over these lands is enshrined in oral history, myths, prayers, and traditional laws that pre-date the Philippine state. These indigenous communities have traditionally lived sustainably in the forest, but have been displaced or are currently threatened with displacement by what they call “development aggression” such as commercial logging and mining. The Philippine Indigenous Peoples Rights Act (IPRA) requires that Indigenous Peoples’ free and prior informed consent be obtained for mining on their lands. However, manipulation of the FPIC process, resulting in the fabrication of their consent, is widespread.”7

Last March 21-23, 2011, more than 150 indigenous peoples gathered in the National IP Summit. In the Summit Resolutions, the delegates called for the following: i) Repeal the Philippine Mining Act of 1995 and support the passage of alternative mining bills that provide for the rational management of minerals and uphold the right of indigenous peoples; ii) Respect for the mining moratorium issuances consistent with local government autonomy, iii) Declaration of a moratorium on large-scale mining and strict regulation of small-scale mining; and iv) Prohibition on the use of state forces in the implementation and operation of mining projects.8

3. Large-scale mining poses risks to high biodiversity areas, watershed areas and fragile small-island ecologies. It has also direct impacts on irrigation and agriculture lands of farmers and will contaminate municipal waters and coastal


areas under the Fisheries Code. In the Philippines, most of the mining and exploration concessions are located in watershed areas where demand for waters exceeds the available supply. According to the United States Environmental Protection Agency, water contamination from mining poses one of the top three ecological security threats in the world.

The open-pit mining method will strip mountains and forests that threaten our protected areas. According to HARIBON, in 2011, about 60% of KBAs, and approximately 1/3 of ancestral domains are directly overlapping with the 23 priority mining projects in the country.9

The current issue in Palawan is a clear example of conflicting land use. Mining operations have already destroyed forest and coastal areas, while drastically reducing agricultural productivity of irrigated rice fields. Additional mining applications will encroach in natural forests. This is despite the status of Palawan as a

“Man and Biosphere Reserve” as declared by the United Nations Educational, Scientific and Cultural Organization (UNESCO). Palawan is host to 40% of the country’s remaining mangrove areas, 30% of the country’s coral reefs, has identified 17 key biodiversity areas (KBAs), 2 world heritage sites, and 8 declared protected areas. 49 animals and 56 plant species which are globally threatened with extinction—according to the International Union for the Conservation of Nature(IUCN)—are also found in Palawan. Palawan is so unique and special that a Strategic Environmental Plan (SEP Law or RA 7611) was passed in 1992.10

There are also 429 mining applications in Palawan, with at least two (2) large-scale mining and several contiguous small-scale mining operations. Aside from Rio Tuba Nickel Mining Corporation (RTNMC) operating in Bataraza, two other mining companies are planning to operate in the towns of Brooke’s Point. These are MacroAsia Corporation (MAC), and Ipilan Nickel Corporation (INC). Corporations such as Citinickel, Berong Nickel Corporation and other

10 Conservation International (CI), Priority Sites for Conservation in the Philippines: Key Biodiversity Areas, 2006


mining companies partnering with the Canadian MBMI (under Financial or Technical Assistance Agreements (FTAAs)) represent an additional threat to Palawan forest. All these operations will encroach not only on natural forests but also on core zones and protected areas, if we use the original delineation of the Environmentally Critical Areas Network (ECAN) zones in Palawan. What has happened is that the Palawan Council for Sustainable Development (PCSD) has failed to fulfill its own mandate by releasing environmental clearances and exploration permits to mining corporations in “core” and “restricted” areas, where any form of extractive activity is strictly forbidden.

The indigenous peoples (Palaw’an tribe) in Brooke’s Point have never given their consent to mining operations. Moreover, the resolutions endorsing the operations of MAC and INC signed by the Sangguniang Bayan of Brooke’s Point and by the Sangguniang Panlalawigan of Palawan bypass the decisions and sentiments of the majority of Brooke’s Point Municipality population. In endorsing the mining exploration of both MAC and INC, the Sangguniang Bayan has acted in contradiction with its own Municipal Comprehensive Land Use Plan (CLUP) for 2000-2010, in which mining was never considered as a development strategy. Also barangay governments have approved mining operations, bypassing all forms of consultations with their constituents and neglecting the important requirement of the Local Government Code (RA

7160) with respect to the duty of consulting local people on any project or program that may cause pollution, climate change, depletion of non renewable resources. The anti-mining stand and opposition to MAC and INC operations on the part of the residents of Brooke’s Point Municipality has been made clear in the course of several rallies and peaceful demonstrations from 2008 to 2010.

Mining will also have an adverse impact on Palawan tribes’ sacred and worship sites, which occupy a special position in people’s cosmology and worldview. Furthermore, mining activities will destroy the resource-base on which upland indigenous communities depend for their survival, including water sources and non-timber forest products. It needs to be pointed out that some of these communities have limited contacts with the outside world, are not listed in the national census and are particularly vulnerable to diseases brought in my migrants and miners.


Meanwhile, in June 2011, a group of indigenous peoples claiming to be leaders of the Palaw’an tribe signed a free prior and informed consent with MAC. This was when the real elders (Panglima) and tribal leaders of Palaw’an tribe sought the support of Congressman Teddy Brawner Baguilat, chairperson of the House Committee on National Cultural Communities, and the NCIP. As of now, the NCIP has put on hold its issuance of Certificate of Pre Condition to MAC because of issues that still need to be addressed.

In Mindanao, the town of Cantilan Surigao del Sur, is opposing the operations of Marcventures Mining Development Corporation (MMDC). The mine site is part of a critical watershed area, declared by Pres. Arroyo in 2008 under Presidential Proclamation No. 1747. Aside from the Manobo indigenous tribe—who lay claim to an ancestral domain in the area—the LGU, organized farmers, fisherfolk, professionals, the Catholic Church and even the Provincial Office of the National Irrigation Association (NIA) has publicly opposed the mining operations.

In November 10, 2010, the complainants filed an application for temporary environmental protection order (TEPO) against MMDC. On that same day, the Honorable Court issued a TEPO “restraining and enjoining the defendant from continuing its mining activities and operations inside the Watershed Forest Reserves… covering the municipalities of Cantilan, Carrascal, and Madrid, all in Surigao del Sur, to prevent irreparable damage and injury to plaintiffs and residents of the said municipalities until further notice from this Court.” However, despite the court order, MMDC still continued operations in the mining area.

In August 17, 2011, the Committee on Natural Resources of the House of Representatives conducted a hearing on the TEPO. During the hearing,


MMDC and Department of Environment and Natural Resources—Mines and Geosciences Bureau denied having received a copy of the TEPO, and said they will implement it immediately. But despite this, MMDC was still able to complete shipment of 55,600 wet metric tons of high-grade nickel ore to China, in August 20, only three days after the House Committee hearing.

Another case in point is the Rapu-rapu spills tragedy. In October 11 and 29, 2005, two spills occurred in the Rapu-Rapu Polymetallic Project operated by Lafayette Philippines, Inc, in the island of Rapu-Rapu, Albay. Tones of effluent and toxic materials were spilled in the creeks and coastal areas of Rapu-Rapu, causing fish kills and fish scare. An independent commission was created by then President Arroyo to investigate the matter and to make recommendations. The Rapu-Rapu Fact-Finding Commission (RRFFC) stated that “the two tailings spill incidents were the proximate cause of the health and environmental hazards in Rapu-Rapu and coastal municipalities of Sorsogon.” The commission also commented that DENR has been noticeably consistent in allowing Lafayette to violate especially the environmental protection requirements of its approved Environmental Protection and Enhancement Program (EPEP). Among the commission’s recommendation were: i) Investigation by the Bureau of Internal Revenues (BIR) on the underreporting of ore production and violation of tax laws, ii) Rescinding of economic and financial incentives to the Lafayette group, iii) A moratorium on mining in Rapu-rapu and a suspension of MPSAs in the island pending scientific and experts’ favorable resolution of the issue of ecological conservation and the acid mine drainage problem in a fragile small island ecosystem, iv) Cancellation of the ECC of the mining project, and v) Review of the Philippine Mining Act (RA 7942) specifically the provisions on the ownership and management of mining firms and operations to protect the interest of the Filipino people and the Philippine government. 11 To date, none of these recommendations have been adequately acted on.

4. The policy on large-scale mining is inconsistent with the new laws on climate


change (Climate Change Act or RA 9729) and disaster risk reduction (Disaster Risk Reduction Law or RA 10121). The mining industry is a direct contributor to deforestation. The GHG emmissions of the mining industry is not accounted for, and their demand for energy will exponentially increase these emmision figures. Caution must be observed regarding the Philippines incompatibility to accommodate large-mining operations, given its geography and topography and poor regulatory regime. The country is also prone to mining disasters and other environmental problems. Based on the data compiled by Newsbreak, 10 out of 24 mining comnpanies with projects included in the priority list of the Philippine government were involved in mining accidents or were the subject of pollution investigation for the past two decades.12

The Philippines has already experienced environmentally devastating mining disasters such as the 1996 Marcopper tragedy in Marinduque (the 6th worst mining disaster in the world), which killed marine life in the 26-kilometer waterway and flooded farmlands and villages along its banks, leaving a clean-up cost of US$80 million. The combination of risks involved in mining operations and unpredictable bad weather (such as strong typhoons) will be a double whammy of catastrophes waiting to happen that will cost not just environmental sabotage but worst, cost human lives.

Mining impacted communities, due to the losses of forests and other natural barriers to typhoons, are also the most vulnerable to hydro-meteorological hazards. Any investment by the local and national government for sustainable development, millennium development goals, poverty alleviation, and even


infrastructures can be easily wiped out by a single bursting of a mining dam such as Tapian Pit in Marinduque, which is a continuing threat to the safety of more than 50,000 inhabitants in the low-lying villages. Worst, the contaminated mine tailings will destroy all the biota of Tablas Strait, the common waters of Romblon, Mindoro, Marinduque, Batangas, and Quezon provinces, which is also part of the Verde Island Pass Marine Corridor, the “center of the epicentre of the marine biodiversity of the world.”

5. Social conflicts, human rights violations and killings in mining-hosted communities have escalated. Human rights violations have been documented, and one case has even been elevated and discussed already at the UN Commission on the Elimination of Racial Discrimination or UNCERD. In August 2009, two Subanon leaders – Timuay Boy Anoy and Timuay Noval Lambo – were heard by UN officials, because of the complaint filed by the Subanon against Canada-based mining company Toronto Ventures, Incorporated (TVI). To date, TVI has been forced to recognize the legitimacy of Timuay Boy Anoy’s leadership, but the full implementation of the UNCERD recommendation has not been accomplished by the Philippine government.

Last January 10, 2011, the Commission on Human Rights issued its resolution on the complaint of farmers and indigenous peoples against Oceana Gold Philippines, Inc. (OGPI). The CHR established that: i) OGPI violated the right to residence, the right to adequate housing and property rights of several residents in (barangay) Didipio (Kasibu, Nueva Vizcaya); ii) OGPI violated the right to freedom of movement and the right not to be subjected to arbitrary interference with the home of the people in Didipio; iii) OGPI violated the right to security of persons of the people in Didipio; iv) OGPI violated the indigenous community’s right to manifest their culture and identity; v) OGPI must exercise great caution in exploiting the water resource of Didipio, possibly endangering the community’s fundamental right to access to clean water; and vi) the PNP violated its own operational procedures during the October 2 incident carrying high-powered firearms and by applying unnecessary and unreasonable force.13

The CHR resolution has recommended that the government withdraw the FTAA granted to the foreign company (OGPI) in view of the gross violations of human rights it has committed.

As of April 2011, at least seven (7) anti-mining activists have sacrificed their lives in defense of their land and natural resources. In October 3, 2007, Councilor Armin Marin from San Fernando, Sibuyan Island (Romblon) was shot dead

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while leading a mobilization against the entry of workers from Sibuyan Nickel Properties Development Corporation (SNPDC). In December 23, 2008, Fernando Sarmiento, Chairperson of Panalipdan-Southern Mindanaon was killed. He was leading the local organizations against the exploration activities of PhilCo Mining Corporation in Compostella Valley. In March 9, 2009, Eliezer “Boy” Billanes was shot dead at the public market of Koronadal City in South Cotabato. He was a leading figure against the mining operations of Xstrata-Sagitarious Mines, Inc in Tampakan, South Cotabato. In February 10, 2010, Barangay Captain Ricardo Ganad from Poblacion 3, Victoria, Oriental Mindoro was shot dead. Ganad was President of the Association of Barangay Captains (ABC) in Victoria, and the most outspoken critic of mining in the province. In March 1, 2010, Gensun Agustin from Buguey,

Cagayan Valley, was shot dead while riding his motorcycle, on his way back home from a forum where they discussed strategies on how to strengthen the anti-mining movement in their area. In January 24, 2011, Dr. Gerry Ortega, broadcaster, veterinarian and environmentalist, was shot dead in Puerto Princesa City, Palawan. Aside from being a project manager of the Bantay-Kalikasan of the ABS-CBN Foundation, he was also a staunch critic of the on-going mining projects in Palawan.

Lastly, indigenous leader Nang Florita Caya, who was shot at the back of her head in April 27, 2011, instantly killing her.

These are just some of the documented extra-judicial killings and human rights violations committed against activists environmentalists who have passionately opposed destructive, large-scale mining in the Philippines.

6. Weakening of local autonomy. As of March 30, 2011, at least twenty-two (22) local government units have passed ordinances, resolutions and executive orders opposing the entry or declaring a moratorium on mining operations in their territories. The most notable ones include the i) Provincial Environment Code of the Province of South Cotabato which has a ban on open-pit mining, ii) the Provincial Resolutions of the two Mindoro provinces (Oriental and Occidental), which put a 25-year moratorium on any large-scale mining operations, and iii) Provincial resolution of Marinduque declaring a 50-year


moratorium on mining. Other LGUs with similar measures include the three Samar provinces, the three municipalities of Sibuyan island in Romblon, towns in Davao Oriental, Province of Iloilo, Puerto Princesa City, Tacloban City, Zambales, Bulacan and Quezon. The DENR and the Chamber of Mines have erroneously portrayed this as defiance of local governments against a national policy. It may be more accurate to describe this as a dissonance between the implementation of two national laws—the Philippine Mining Act of 1995 and the Local Government Code of 1991.

7. There are weak regulatory and governance mechanisms in the mineral industry. The DENR does not have enough technical and personnel capacities to adequately address the rigorous demands of the mineral industry. There is no effective “Cost-Benefit Analysis” that will determine the best use of the land. In this absence, there is little evidence that the “net effect” of the mining industry will be positive for the Philippine economy, let alone contribute to poverty reduction. The Philippines does not have a National Industrialization Plan. The downstream industry of minerals and metals is practically undeveloped, with no blueprint. The Corporate Social Responsibility framework of the Chamber of Mines continues to be a work in progress, while the destruction of biodiversity, cultural displacement of indigenous peoples and escalation of social conflicts in mining areas pursue.

8. The myth of “responsible mining”. The global and local mining industry suffered from the backlash of its attempt to re-package itself as “sustainable mining”. Environmental groups, human rights groups, think-tanks and IP support groups exposed this “re-labeling” approach. Consequently finding itself unable to respond, the mining industry had to contend itself with the


branding of “responsible mining”. The framework of responsible mining is drawn from the so-called ‘best practices’ of various mining operations happening simultaneously in different countries. BUT this model has not been successfully closed or “looped-in” in one single operation in a specific area. Moreover, no large-scale mining operation has completed the whole cycle of the model yet. ATM believes that the concept of responsible mining is a weak model, because it a) relies on voluntary compliance of large-scale mining companies; b) highly depends on the ability of the government to enforce and implement the safeguards articulated in national laws and policies; c) does not address the issue of corporate and state graft and corruption, a scenario that is not totally insulated in the extractive industries; and d) there is token recognition of safeguards (participatory process, free prior and informed consent, Environmental Impact Assessment). Furthermore, the industry’s track record has earned enormous social distrust, which does not adhere to the elements of ‘responsible mining’, and there are evidences that such illegal, sub-standard, unethical, dirty and unsustainable practices in the mining industry continue, despite the effort to peddle the concept of “responsible mining”.


POLICY RECOMMENDATIONS

1. The new MTPDP (2011-2016) must drop the priotization of revitalizing the mineral industry. EO 270-A (Revitalization of the Philippine Mining Industry) must be revoked immediately. Chapter 10 of the MTPDP is a failure in participatory processes, when the CSO inputs on the very controversial mining issues were watered down, re-phrased neutrally or even outright deleted in whole paragraphs. Numerous studies have showed that mining has not contributed significantly to economic growth in terms of tax revenues, substantial investments, or employment. It has too many incentives, and is suffering from tax undercollection and uneven distribution on benefits to major stakeholders, even among government agencies.

In fact, it is not difficult to trace that there are strong inconsistencies in the new MTPDP when mining is overlaid with the policy to push for rural development. Mining will not bring “inclusive growth” as indigenous peoples access to their ancestral domains and natural resources are constrained, human rights are violated, biodiversity destroyed, local autonomy is weakened and graft and corruption left unattended. Finally, revitalization of the mining industry goes against Points # 15 and 16 of the President’s Social Contract to the Filipino people.


2. The government must adopt a policy of “the whole Philippines is not open to mining, unless certain conditions (e.g., asset reform, social justice, cost-benefit analysis, etc.) reveal that extracting the mineral is the best use and most economically beneficial option. There are several areas in the Philippines – given their topography, geo-hazard, fragile ecology, economic/productive use, cultural value or current land use – are not suitable or even directly in conflict with mining. For large-scale mining to pursue, a Cost-Benefit Analysis (CBA) must be completed for all current mining projects and new mining applications. The CBA must take into account all factors that will be affected by the mining project, including ecological services, cultural and social values, just compensation, and reasonable comfort. Unless the CBA shows a net positive impact, the mining contract must either be withdrawn or reviewed.

In the interim, the government must declare several areas in the Philippine territory as “No-Go Zones” for mining and other extractive industries. The basis and justifications for such declarations are i) embedded in several national laws, ii) reflected in international treates and multi-lateral environmental agreements that the Philippines have acceded to, and iii) initiative or concurrence of local governments.

3. The current Philippine Mining Act of 1996 (RA 7962) is flawed, given that its conflicts or inconsistencies with other laws is clearly manifested. Enforcement issues and weak governance and regulatory mechanisms are pervasive. A new mineral management law, that promotes a balance of mining implementation with other laws (IPRA, NIPAS, LGC, AFMA, EIA/EIS, Climate Change Act, etc.), must be enacted. The government must certify the pending bills on


mining in Congress as urgent (HB 207 and HB 3673). The new mining law must ensure that the conservation of non-renewable mineral resources is for the benefit of both present and future generations of Filipinos. This can be done by adopting a sustainable, rational, needs-based minerals management policy, geared towards effective utilization of mineral resources for national industrialization and modernization of agriculture.

4. As the findings of several researches reveal, too much risk and negative impacts are being introduced by the current policy on aggressively promoting large-scale mining. It is not enough that mining applications are suspended. A moratorium on large-scale mining operations must be immediately imposed so that carrying capacities of ecologies can be improved. Permits for pending applications must not be issued, and all large-scale mining operations that have questionable circumstances (resistance of communities, opposition of LGUs, flawed procedures, etc.), must be immediately suspended and reviewed.

Government must immediately act on recent recommendations and resolutions that are directly related to large-scale mining:

i) Commission on Human Rights (CHR) resolution last January 10, 2011, on human rights violations of Oceana Gold Philippines, Inc. (OGPI) and the recommended withdrawal of the mining contract;

ii) The recommendation of the Rapu-Rapu Fact Finding Commission (RRFFC) last August 2006, recommending the withdrawal of the ECC and suspension of the MPSA of the Rapu-Rapu Polymetallic Project in Rapu-Rapu, Albay;


iii) Revocation of the ECC of Intex Mining Corporation in Oriental Mindoro, issued by DENR last November 2009;

iv) Recommendations of the UN Commission on the Elimination of all forms of Racial Discrimination (UNCERD) issued last October 2009 and reitereated last August 2010, to ensure the protection and promotion of the rights of indigenous peoples;

v) Temporary Environmental Protection Orders (TEPOs) issued by courts and writs of kalikasan granted by courts.

5. The principles of local autonomy must be respected. LGUs who have passed resolutions and ordinances banning mining or issuing moratoriums against mining in their localities must be respected and upheld. The Department of the Interior and Local Government and the Department of Justice must review and upgrade their position that a “2-out-of-3” ruling of LGUs giving permission is equivalent to “consent” or endorsement of the LGU. Both should be regarded as what they are – “opinions”. Sec. 26 and 27 of the Local Government Code (LGC) must be absolutely respected, where it states that ALL LGUs to be affected by national development projects (including mining) must give their consents.

6. Should the government decide to retain its misplaced policy of aggressively promoting large-scale mining, several structural and policies must be put in place, prior to granting of application permits and actual mining contracts. These include:

6.a Finalization of a National Industrialization Plan, that will indicate the actual minerals and metal needs of the country, that will contribute to the realization of this industrialization plan.

6.b Complete an accurate and realistic inventory of the actual mineral reserves, pin-pointing the specific locations, types and values of the minerals, that will be potentially extracted.


6.c Produce a mineral extraction plan that will respond to the actual needs specified in the National Industrialization Plan, while considering the other alternative (and more beneficial) uses of the targeted mineral lands.

7. The government must sign-up to the Extractive Industry Transparency Initiative (EITI), in order to practice and implement transparency and accountability of mining companies operating here in the Philippines.

8. An EO must be issued by the President not to allow mining operations in areas that are scientifically identified as important biodiversity areas (IBAs), watershed areas and natural forests. These areas are aside from the protected areas system already covered by NIPAS. The EO must also include provisions that consent of LGUs and IPs, whenever applicable, that are of paramount requirements before mining is permitted.

9. The government should demonstrate its capacity to uphold the right of the people to a balanced ecology by ensuring to expedite the prosecution of all cases related to large-scale mining incidents such as the Marcopper tragedy of 1996 in which all cases filed in relation thereof have not reached even the trial stage 15 years after.


ATM Assessment of PNoy 1st Year

This assessment attempts to assess the performance of the PNoy administration in its first year in relation to the issue of large-scale mining. A 10-point indicator system is used as a barometer to determine the success or failure of the Aquino government in addressing the key concerns revolving the revitalization of the mining industry in the Philippines. The indicator system is a combination of reviewing the administration’s responses and delivery of commitments, along the lines of 1) the main calls of the ATM campaign; 2) the initial set commitments of the DENR under Sec. Ramon Paje; 3) introduction of reforms in key government agencies and offices directly related to mining issues; and 4) the different scenarios unfolding in key sites of struggles within the ATM campaign. The matrix below presents the indicators and a brief explanation of the parameters in the assessment exercise.

1. Scraping of the Mining Act of 1995 (RA 7942) and enactment of a new mining law

2.

3. Mining on mining

4.

Enact the Alternative Minerals Management Bills!


5.

6.

7. b. Arangkada 2011

8.

of mining

9.

10.

As with other assessments of other sectors on the performance of the first year of the PNoy administration, it is critical that the policies and actions of the previous government be used as reference.

The GMA administration shifted the government policy from “tolerance“ to “aggressive promotion“. This led to the streamlining of mining applications process, and the increased number of approved mining contracts. In turn this resulted in amplified social issues, as indigenous peoples were physically and culturally displaced and the key biodiversity areas of the countries were directly threatened. Social tensions also escalated, as local communities, including many local government units, mounted strong resistance against the entry or expansion of mining projects. On the other hand, the asset reform, social justice and sustainable development tracks of government was effectively set aside.

Upon assumption of the Aquino administration, mining activists, together with the broader environmental movement, held on to high expectations for reforms. This expectation has since then been downgraded to “guarded optimism“ after the first year of PNoy’s government.


Several bills on mining have been filed with the 15th Congress. These are HB 206 (Alternative Mining Bill), HB 3763 (Philippine Mineral Resources Act) and HB 4315 (People’s Mining Bill). Despite significant support from senior and newly-elected representatives, to date however, no committee hearings have been conducted. No parallel bill has been filed at the senate. The prevailing impression is that the Liberal Party is supportive of a new mining law. The mining bills have not been prioritized, and there is no indication that it will be certified as urgent by President Aquino. No clear directives to push for the mining bills from the Office of the President is seem to be forthcoming, nor were there indications that mining issues were discussed in the LEDAC, except during the finalization stage of the draft PDP. On this item, the PNoy administration gets a failing mark

ATM has sent at least two formal communications to the Office of the President, urging the immediate revocation of EO 270-A or the Revitalization of the Philippine Mining Industry. ATM’s position is that this is a legacy of the GMA administration, and as a misplaced economic policy, has no rightful place in the “tuwid na daan”. The Office of the President has twice responded, informing ATM that the matter has been referred to the DENR Sec. Ramon Paje, and that his official recommendation is being awaited, with complete staff work. To the best of our knowledge, no recommendation has been sent to the OP on this matter. There is a move to sign a new EO on mining, and contains the controversial proposal of Sec. Paje to declare 23 mineral reservations. The official position of ATM has been relayed, opposing this provision in the draft EO, and counter-proposing a “no-go zone” policy which will prohibit mining in key biodiversity areas and fragile island ecosystems, as strongly positioned by HARIBON, one of the ATM convenors. A recent report from the House Committee on National Cultural Communities (IPs) has recommended that


ancestral domains be included as “no-go zones” for mining. For this item, the PNoy administration is disappointing.

No policy pronouncement for a moratorium on mining has been declared by the Aquino administration. House Resolution 528 has been filed at Congress, authored by Rep. Teddy Brawner Baguilat from the lone district of Ifugao, calling for such a mining moratorium. This has not been acted upon by Congress. PNoy gets a failing mark on this. In the first few engagements of civil society with Sec. Paje, one of his initial commitments was public disclosure of mining contracts. After several attempts and months in waiting, photocopies of the contracts of the 23 priority mining projects were sent to the ATM office. For a limited time, these were also available in the DENR website. Since then, the list of mining applications and approved mining contracts are downloadable from the internet. This is an improvement. However, the critical portions of mining documents — EIA reports, feasibility studies, ECCs — still remain inaccessible. Maps of mining tenements are likewise almost impossible to procure. ATM has proposed that “midnight mining contracts” be subjected to review. This has not been done. The DENR has done an internal audit of almost 2,000 mining contracts, and they reported that they have canceled almost 750 of these for their non-performance. However, they have also recommended the pursuit of more than 125 mining applications and live contracts. Commendation for the effort of public disclosure is in order. It is, however, inadequate, and therefore, disappointing.


With regard to the “legacy problems” of mining tragedies and disasters in the past, after one year of PNoy administration, very little has been actually achieved. Assessment for the rehabilitation of the Bagacay Mine has been completed. But that’s about it. There is not enough capacities, resources and resolve to address the abandoned and idle mine sites. The Marcopper tragedy in Marinduque has not been addressed. There is no public information about the Mabatas Tailings Dam. Finally, the assessment of the 7 abandoned mines has not been completed. For this item, the DENR and PNoy get a failing mark.

In terms of engaging the government, civil society is relieved to witness and be part of remarkable accomplishments. Significant reforms in the National Commission on Indigenous Peoples (NCIP), the Commission on Human Rights (CHR) and the National Anti-Poverty Commission (NAPC) were clearly pursued. These bodies have significant contributions in resolving conflicts in mining-affected

communities, particularly in the case of indigenous peoples. Numerous resolutions have been issued including cases in Nueva Vizcaya and Palawan. Assessments and evaluations, including financial and legal audits of the performance and outputs of these agencies are well underway, possibly pointing to even greater reforms. Some fruitful engagement with the Climate Change Commission (CCC) was also recorded. Even the DSWD have extended its interest to engage civil society to support initiatives for IPs and rural poor impacted by mining. To this end, this item can be described as a successful effort, and gets a high passing mark.

ATM has actively engaged the formulation process of the Philippine Development Plan (2011-2016). The engagement can be illustrated as a running battle, with the civil society trying its best to keep up with the intent of the mining industry and the DENR to sustain the priority status of mining as an economic policy. Overall, however, the process of crafting the new PDP can be described as participatory, open and


genuine. Theoretically, mining has been downgraded, with its role characterized as needing to comply with the conservation, protection and rehabilitation policies of the government. Meanwhile the Economic Cluster of the administration continued to pitch mining as a critical industry, effectively inserting it as one of the investment priority areas of the Aquino administration. With these conflicting aspects, the PNoy administration is given a unsatisfactory rating.

LRC-KsK, one of the ATM convenors, has eloquently described the commendable behavior of several LGUs, in their assertion to say no to mining in their territorial jurisdiction. Despite the continuous policy on mining, LGUs have gained ground with several provinces issuing executive orders and passing resolutions not to allow mining and effetively withdrawing their consent. The trailblazing effort of South Cotabato with its Provincial Environment Code has inspired other LGUs, including Zamboanga del Sur, to replicate the local ordinance. On the other hand, while there will be few to question the capability and integrity of Sec. Jesse Robredo of the DILG, the anti-mining movement was shocked when he issued a Memo Order instructing the Provincial Government of South Cotabato to review a provision on its Provincial Environment Code that banned open-pit mining in the locality. It should be mentioned however, that DILG officials have in general, remained open to dialogue and negotiations on a case-to-case basis. Conscious of the principle of decentralization and local autonomy, ATM gives LGUs a high grade, while disappointed with the misinformed stance of the DILG.

Indigenous peoples bear the brunt of the negative impacts of mining. More recent maps produced by ATM members reveal that more ancestral domains are threatened by mining, as compared to available data in 2005. This scenario is compounded by the questionable issuance of FPIC (free, prior and informed consent). It is interesting to note that remedial measures have been initiated. A review of the 2006

Sagittarius Mines, Inc. (SMI) of the Philippines, along with Australian-based Xstrata Copper (a subsidiary of the Swiss-British giant Xstrata Plc) and Indophil Resources NL, also of Australia, is proposing a project that will impact the South Cotobato, Davao del Sur, Sarangani and Sultan Kudarat provinces. Mining in Tampakan will:

Cause extensive physical disturbance of almost 10,000 hectares of forest lands that serve as the watersheds of the four provinces of South Cotabato, Sultan Kudarat, Davao del Sur and Sarangani;

Leave 1.65 billion tons of waste rock and 1.1 billion tons of tailings in an area of high seismic activity and fault lines;

Affect the water resources of communities, as it will impact the head waters of 7 river systems, affecting water supply reserved for residential and irrigation purposes;

This mining project will use up thousands of liters of water per second;

Cut down 4,000 hectares of forests including old growth forests, which are initial components of the protected areas system (NIPAS);

Displace more than 2,600 people belonging to the B’laan communities; the mine site will also affect the ancestral domains, covered by CADT 102, CADT 108, CADT 72 and CADC 74;

It will also undermine the Provincial Environment Code of South Cotabato’s ban on open pit mining signed last June 29, 2010.

*all data were derived from SMI’s own draft Environmental Impact Statement last April 2011


FPIC guidelines was recently concluded, and civil society is awaiting with much anticipation the results of these exercise, looking forward to substantial reforms. Credits go to the newly-installed NCIP commissioners and the House Committee on NCC (IPs). While cases involving conflicts in ancestral domains versus mining remain considerable, there are enough openings to be hopeful. But these are only enough for a passing mark.

Actions of the PNoy administration to site-specific cases reveal ambivalence regarding the mining issue. On one hand, favorable action has been observed with the decision to cancel mining contracts in Palawan, and the public recognition that the stand of the LGUs not to accept mining is legitimate, such as the cases in Romblon and Oriental Mindoro. The situation in Tampakan, South Cotabato, seems to be a problematic for the government, though, as the government has sent signals to foreign investors that the national government is ready to intervene, when the right time comes. Using the escalating tensions being reported by the Sites of Struggles as a barometer, it is safe to say that while some forms of victories in some sites have been gained, this is not a general rule. For this matter, a rating of disappointment is justified.

Summary Rating of PNoy Administration on the Mining Issue

1. Scraping of the Mining Act of 1995 (RA 7942) and enactment of a new mining law


PRESS RELEASE

September 19, 2011

Greens ask: If DENR doesn’t, who will?

A synergy-promoting coalition of nearly 30 organizations and networks working on various environmental concerns has expressed extreme disappointment in the DENR. The Green Convergence for Safe Food, Healthy Environment and Sustainable Economy (GC) said that while DENR is supposed to protect the environment, recent news reports are proving the opposite.

The group disclosed that among the series of news that had drawn their ire was the most recent pronouncement of DENR Sec. Ramon Paje about the possibility of lifting the ban on mining applications and reconsidering even those that had been rejected. GC said Paje has clearly sided with the mining industry versus the will of the Filipino people who have persistently asked that this destructive business be limited if not banned completely.

Paje has also reportedly recommended that areas where mining companies are operating be turned into mineral reserves so that the government can collect a higher percentage of the companies’ income. GC pointed out, however, that while it may seem like a good idea, a closer look would reveal that its downside far outweighs its potential income benefit.

Fr. Archie Casey, GC Internal Vice-President, explained, “If that is done, the mining company would have rights over everything in the area and not be subject to the laws that are precisely meant to protect our resources -- like the NIPAS on protected areas, IPRA on the rights of indigenous peoples, and EO 23 on the logging moratorium in natural and residual forests. The companies would also have the right to all the water in their reserve, to the detriment of communities living there.” The priest, who represents the church-based JPICC-AMRSP in the Green Convergence, concluded, “All of these are unacceptable.”


Citing a separate news report that MMDA Chair Francis Tolentino planned to revisit incineration as a garbage solution and that Paje had been consulted about it, Marie Marciano, GC External Vice-President and an active zero-waste advocate of the EcoWaste Coalition, remarked, “Sec. Paje should have been the first to oppose this move, because incineration is banned under the Clean Air Act to protect our people and environment from the dioxins, furans, heavy metals and other toxic by-products of incineration.”

According to Marciano, although Chairman Tolentino gave assurances that new technologies can keep emissions at a minimal level, there is no safe level of exposure to some of these highly toxic substances, particularly dioxin, and there is yet no ‘high tech’ incinerator that can completely prevent harmful emissions. “Besides, waste can be converted to badly needed resources, so burning waste is tantamount to burning money!” she emphasized.

The group also lamented an earlier report that Paje had recommended the exploitation of the West Philippine Sea for its oil. “Does he not take global warming seriously?” asked GC Secretary Noemi Tirona of the Consumer Rights for Safe Food (CRSF).

“He should be the first to advise the President to shift away from the fossil fuel economy, since studies have clearly shown that the Philippines is blessed with more than enough renewable energy sources to power our development far into the future,” she said, adding further, “Exporting the oil for economic gain is not worth the suffering and losses that will be caused by climate change.”

Green Convergence believes that at this point in time, when the environment has been so devastated, DENR should do all in its authority to prioritize the environment.

“There are many ways by which we can advance national development through programs that would sustainably utilize our natural patrimony,” declared Dr. Nina Galang, GC President, who also revealed that their coalition had been pointing this out, dialoguing with Sec. Paje precisely to enjoin him to show bias for the environment. “This is his role in the Cabinet; raising money is not,” she stressed, “and if DENR does not speak to the President for the environment’s protection, who will? “

Reference:

DR. NINA P. GALANG9296671

09178538841

Alyansa Tigil Mina (ATM) is an advocacy group and a people’s movement that upholds the rights of the present and future Filipinos against the persisting injustices related to large-scale mining.

The term “tigil-mina”going against (to prohibit or ban) all kinds of mining. What ATM is referring to, is stopping the policy regime on large-scale mining being adopted by the Arroyo administration and the Department of Environment and Natural Resources (DENR), which irrationally exploits mineral resources – undermining the ‘real value of land’ (where minerals are found) to Filipinos and promoting purely foreign-controlled and export-oriented mining industry, problems, poverty situation, environmental and other socio-political concerns in our country.

ATM, formed in 2004, is a coalition of organizations and individuals from mining-affected communities, NGOs, POs, church-based organizations and academic institutions, that decided to disengage from the series of consultations convened by the DENR regarding the revitalization of the mining industry through the aggressive promotion of large-scale mining in the country.

Much like the Bantay Mina coalition in the 1990s and the Peoples’ Call presented at the Dapitan Initiative in 2002, ATM serves as a watchdog that

corporations/institutions, multinational mining corporations and other key players to expose their wrongdoings and failures of the laws and policies, their implementation and the practices involved in the mining industry.

Alyansa Tigil Mina

Alyansa Tigil Mina National Secretariat

# 973 Aurora Blvd. corner Dapdap St., Anonas, Cubao, Quezon City 1109 Philippines

Tel.: +63 (02) 434.46.42 loc 27 Fax: +63 (02) 434.46.96

Emails: [email protected] [email protected] [email protected]

Website: Facebook: Twitter: www.alyansatigilminat.net Alyansa Tigil Mina atm_philippines

Alyansa Tigil Mina

ATM Policy Paper on Mining in the Philippines

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Transcript of ATM Policy Paper on Mining in the Philippines