Mining sector opposes 8 ‘mining-free’ zones

Pia Ranada

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Mining sector opposes 8 ‘mining-free’ zones
(UPDATED) The Chamber of Mines says proposals to declare mining-free zones could limit the country's potential for economic growth

MANILA, Philippines – (UPDATED) Representatives from the mining sector expressed their reservations about the plan to declare 8 provinces as mining-free zones during a Senate hearing on Tuesday, February 17.

The hearing looked into 8 bills filed separately by 8 congressmen to declare their provinces and one district as off-limits to mining.

These areas are: 

  • Cagayan de Oro City
  • Catanduanes
  • Nueva Vizcaya
  • Eastern Samar
  • Nueva Ecija
  • Biliran
  • Davao City
  • 2nd District of Sorsogon

Banning mining from these areas will “set a bad precedent” for the Philippine government, said Chamber of Mines of the Philippines vice president for policy Ronald Recidoro during the hearing.

“Mineral resources are limited, finite and do not occur everywhere. They are concentrated in only a few blessed provinces. This deprives the national government of the chance to develop a national industrialization plan,” he added.

Around 65% of the Philippines cannot be mined under current laws and executive orders despite the vast potential of the country as a source of minerals. 

The Fraser Institute of Canada, a public policy research organization for Canada, puts the Philippines among the top 10 countries most attractive for mineral development based on mineral potential alone.

But the country is also among the least attractive locations “because of policy and bureaucratic obstructions and the lack of government support for mineral development,” reads a statement from the Joint Foreign Chambers of the Philippines.

Currently, Executive Order No 79 puts a moratorium on all new mining contracts until a new revenue-sharing agreement between mining companies, national government and local government is finalized. In 2013, mining contributed only 0.7% to Gross Domestic Product (GDP), according to the National Economic and Development Authority.

‘Not a penny’

But the congressmen who filed the bills defended their proposed laws saying mining has led to nothing but catastrophe for the provinces they represent.

“Mining is destructive to the environment of our province. We prioritize agriculture over mining,” said Representative Carlos Padilla of the lone district of Nueva Vizcaya.

There are two companies mining for gold and copper in Nueva Vizcaya: Canadian-owned Oceana Gold and British-owned FCF Minerals Corporation.

They are both covered by the Financial Technical Assistance Agreement (FTAA) which allows companies 100% owned by foreigners to extract minerals in the Philippines.

The province, said Padilla, “does not get a penny” from Oceana Gold. The mining company did not get the consent of the provincial council and do not pay realty tax, he added. 

They used to pay excise tax and business license tax but no longer do so.

Meanwhile, it’s the local government that bears the responsibility of tending to supposed human rights abuses, people displaced by the bulldozing of houses and the environmental degradation due to the mining activities, said Padilla.

Oceana Gold chairman Jose Leviste Jr denied any human rights abuses and said they provide housing for those displaced by the company’s activities.

He said they no longer pay excise tax because the Board of Investments has exempted them from doing so.

As for the payment of business license tax, he said the company received a letter from nearby Quirino province claiming it is their province who should be given the tax, not Nueva Vizcaya because the mining area falls under their jurisdiction. 

“Quirino complicated things. There’s a lawsuit now and we’re trying to work things out,” he told the body.

But Padilla said there are other reasons to declare his province mining-free. Nueva Vizcaya houses an important watershed that supplies water for major dams like the Magat and Ambuklao dams. These dams irrigate thousands of hectares of farmland in Luzon.  

Some 15 tribes are threatened with displacement by mining because their ancestral domains sit on top of the mineral deposits. On top of that, the province’s steep solves and increasing rainfall make it susceptible to landslides. 

Benefits of mining

In Catanduanes, a company has been given permits from the Department of Energy to mine for coal, said Representative Cesar Sarmiento who authored a bill to declare the province off-limits to mining.

Australian company Altura Mining was given a coal operating contract covering 7,000 hectares. Sarmiento’s bill aims to protect Catanduanes’ forests, the largest remaining forest cover in Bicol, from the effects of mining.

In the past, Catanduanes citizens backed by the church were able to boot out Australian mining firm Monte Oro Resources and Energy Inc from mining its coal deposits. There is also a provincial ordinance declaring the province a mining-free zone. 

But Julian Payne, president of the Canadian Chamber of Commerce, said mining could pose benefits to local communities.

He said mining generated 252,000 direct jobs and around 1 million indirect jobs in 2012.

But Primo Morillo of social development network Philippine Miserior Partnership said whatever benefits mining provides is only temporary.

“They say the resources are finite so when they are gone, they will leave. Whatever development will happen is temporary but the effect of mining is permanent,” said Morillo, whose group has worked with several communities affected by mining.

He suspects that the growing trend of mining-free zone declarations is because lawmakers and LGU leaders have seen the effect of mining in their areas of jurisdiction.

Cagayan de Oro City blames mining for the flooding during Typhoon Sendong while Davao City learned from the experience of Davao Oriental, where there is gold-mining, during Typhoon Pablo.

Senator Loren Legarda, chairperson of the Senate Environment Committee, decided to suspend the hearing until more data on the benefits of mining could be presented. 

“I want to see poverty incidence before and after mining. I want to see environmental impact assessments. I am not anti-development but I believe that mining companies should be responsible.” –

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Pia Ranada

Pia Ranada is Rappler’s Community Lead, in charge of linking our journalism with communities for impact.