Philex settles P1-B mine leak fine

MANILA, Philippines (UPDATED) – The country’s biggest gold producer turned over a P1 billion check to the government on Monday, February 18, to settle in full one of the penalties it was slapped for its Padcal mine tailings pond leak.

In a turnover ceremony at the Parks and Wildlife in Quezon City, Philex president Eulalio Austin Jr. turned over the check to Mines and Geosciences Bureau (MGB) director Leo Jasareno as Environment Secretary Ramon Paje looked on.

The check amount is P1,034,358,971.00, representing penalties the government imposed over violations against the Mining Act.

It is a managers check — which is good as cash– was drawn from an account with Mizuho Bank’s Manila branch and payable to MGB, which was also asked to receive the transmittal letter for the check.

Industry benchmark

Paje previously denied Philex’s request to pay the fine on installment basis and the mining firm’s proposal to offset the fine against its rehabilitation expenses.

“This will serve as benchmark for the industry. This means government means business. For cases like these, we cannot and we’ll never sacrifice the environment for economic gains.,” Paje said.

“We are happy to receive Philex this morning, it only shows that we have a very responsible entity in the mining industry for adhering to the guidelines of government and for paying the required penalties for this particular incident,” Paje added.

Jasareno said the payment the MGB received from Philex will be remitted to the National Treasury. This, after the MGB has issued an official receipt to Philex.

The National Treasurer, an agency under the finance department, has a Mine Waste Tailing Reserve Fund. Jasareno said the fund can be used for claims or compensation and rehabilitation costs of areas affected by tailings.

“We believe it was a result of the elements of nature—an event of force majeure,” Michael Toledo, senior vice president for Corporate Affairs, maintained. 

Partial mine operation

Philex is currently asking the government to allow it to partially operate the tailings pond as part of the rehabilitation efforts.

Jasareno later told reporters that the MGB will still evaluate the case of Philex and won’t be ready with a decision until after a few more days. 

“The decision of the MGB [and the] DENR is that, before we answer anything, we will ask this amount to be paid first on or before the deadline,” Jasareno said, referring to the original February 19 deadline set for the settlement of the P1-billion fine.

“We will evaluate and we may be able to render a decision in a matter of a few days,” he added.

Mine incident

Philex was slapped another P92.8 million fine over pollution issues, including violations against the Clean Water Act. 

The tailings pond leak at Philex’s only operating mine in Padcal, Benguet spilled 20.69 million metric tons of mine waste into adjacent water systems, including the Balog Creek, which is adjacent to the Agno River, a key livelihood and hydropower source in central Luzon.

The incident, which occurred in August after days of torrential rain in the area, is considered the country’s biggest mine leak incident in terms of volume spilled. – Rappler.com