DMCI Mining to lay off 400 workers as DENR stops expansion

MANILA, Philippines – The mining business of the Consunji group is set to lay off about 400 workers in the coming weeks, after the Department of Environment and Natural Resources (DENR) blocked its expansion plans.

DMCI Mining Corporation told the Philippine Stock Exchange (PSE) on Monday, August 15, that the group is bracing for a tougher second half of the year, as both of its companies in Palawan and Zambales received suspension orders from the DENR.

“Early this year, we were planning on expanding our operations. But with the suspension, we have no choice but to put everything on hold,” DMCI Mining president Cesar Simbulan Jr said in the regulatory filing. 

Palawan, Zambales operations

DMCI said Berong Nickel Corporation in Palawan is set to lay off over 300 seasonal workers in the coming weeks, while Zambales Diversified Metals Corporation had already let go of more than a hundred employees.

“We actually acquired over P100 million in additional heavy equipment during the first half, and had plans of hiring more workers to ramp up production. Unfortunately, this is no longer possible,” Simbulan added.

The chief of DMCI Mining said his company is already talking with host communities to explain the situation.

“They know that this is something beyond our control,” Simbulan said. (READ: Duterte to mining industry: ‘Filipinos will survive without you’)

He added that DMCI Mining is fully cooperating with the government to facilitate the audit and lift the suspension order.

“Our mining and environmental management protocols are consistent with regulatory standards so we hope to resolve the suspensions and resume operations soon,” Simbulan said. (READ: Gina Lopez: Philippine Mining Act an ‘unfair’ law)

Declining nickel

In the first 6 months of the year,  DMCI Mining saw a 25% decline in nickel ore shipments, slipping to 87,337 wet metric tons (WMT) from 1.16 WMT.

This is because of the declining nickel prices and sluggish demand for lower-grade nickel. (READ: Investors in mining panic over Gina Lopez appointment)

During the first half of 2016, the average selling price per WMT fell 40% to $28 from $41.

Eighty percent of DMCI Mining’s shipment goes to China, while the remaining 20% is shipped to Japan.

The DENR is conducting an audit of all operating mines in the country. (READ: Mining in PH: What Gina Lopez, Duterte have said)

So far, the department has suspended the following mining firms: Benguet Corporation, Nickel Mines Incorporated, Eramen Minerals Incorporated, LNL Archipelago Minerals Incorporated, Citinickel, Claver Minerals Corporation, Mt Sinai Mining Exploration and Development Corporation, and Emir Mineral Resources Corporation.

DENR Secretary Gina Lopez is a known anti-mining advocate. (READ: What drives Gina Lopez?) – Rappler.com