Following a thorough review of the suspension and cancellation orders issued last February 8, 2017 by then DENR Secretary Gina Lopez, the DENR resolved the Motion for Reconsideration (MR) filed by 13 mining companies.

In the Resolutions issued by Secretary Roy Cimatu on November 12, 2018, three (3) out of the twelve (12) mining companies that were previously ordered closed were resolved to remain closed. The cancellation of Mineral Production Sharing Agreements (MPSA) of Claver Mineral Development Corporation and Oriental Synergy Mining Corporation was affirmed. The denial of the MPSA Application of Ore Asia Mining and Development Corporation was also affirmed.

The Resolutions directed immediate and complete payment of all fines and penalties for the violations committed by these companies. DENR also ordered that no transport of ore shall be allowed until full rehabilitation is undertaken by these mining companies.

Nine (9) out of the thirteen (13) mining companies that were previously ordered closed were resolved to be suspended. These are:

1. Zambales Diversified Metals Corporation;
2. Krominco Inc.;
3. Mt. Sinai Exploration and Development Corporation;
4. Libjo Mining Corporation;
5. Wellex Mining Corporation 1 and Wellex Mining Corporation 2;
6. Carrascal Nickel Corporation;
7. AAMPHIL Natural Resources Exploration and Development Corporation;
8. Strong Built Mining Development Corporation; and
9. Emir Mineral Resources Corporation.

On top of the payment of the fines and penalties, these companies were directed to undertake corrective measures within a timetable. Failure to implement these measures will result in the reinstatement of the Cancellation Order previously issued to these companies.

Another Resolution was issued lifting the previous Suspension Order for Berong Nickel Corporation subject to implementation of corrective measures.

The decisions made by the DENR were a product of well-studied review. It largely used the findings based on the Report, “Objective, Fact-finding and Science-based Review of the Performance of Twenty-Six (26) Mining Companies” of the Technical Review Teams (TRTs) commissioned by the Mining Industry Coordinating Council (MICC). The MICC TRTs was tasked to conduct a multi-stakeholder review to advise the DENR on the performance of existing mining operations.

Sec. Cimatu explained that when he came in as DENR Secretary in May 2018, he was confronted with the unresolved Motions for Reconsideration on the suspension and cancellation orders filed in 2017. “In order to gather the necessary data and justification of any decision regarding the suspension and cancellation, the third party audit by experts was utilized.”, Sec. Cimatu said.

In resolving the MR filed by the mining companies, the DENR considered the findings and recommendations of the previous DENR Mining Audit and the Technical Review Committee. The Regional Offices of the DENR, Environmental Management Bureau (EMB) and Mines and Geosciences Bureau (MGB) were also required to report the compliance of the 13 mining companies which filed MR to the findings of all the previous DENR audits conducted.

The MICC review covered nineteen (19) nickel mines, three (3) gold and gold and copper mines, three (3) chromite mines and two (2) magnetite/iron mines. The MICC review assessed the performance of the mining companies on five (5) aspects: Legal, Technical, Environmental, Social, and Economic. An environmental score card was devised to determine whether company’s performance is acceptable or not.

The MICC TRTs Report stated “Based on the TRT firm level reports that focused the reviews of 26 mining companies on five aspects (legal, technical, environmental, social and economic), there was basis for the DENR suspension/closure actions in 2016. Yet, while non-compliance with laws and implementing regulations appear substantial, there is a need to re-examine the penalty versus the sobriety of infractions and their impacts on society.”

Of these 26 mining companies which were issued Suspension and Cancellation Order on February 8, 2017, 13 filed Motion for Reconsideration before the DENR, 13 filed Appeal before the Office of the President. The Resolutions issued by the DENR may still be appealed to the Office of the President.

Published: 16 November 2018

The DENR disclosed the highlights of the report of the Technical Review Teams (TRTs) which were commissioned by the Mining Industry Coordinating Council (MICC) to conduct an objective, fact-finding and science-based review of the performance of twenty-six (26) mining companies in the country.

The MICC review covered nineteen (19) nickel mines, three (3) gold and gold and copper mines, three (3) chromite mines and two (2) magnetite/iron mines, for a total of twenty-seven (27) mines of twenty six (26) mining companies. It assessed the mining companies’ practices in terms of the following aspects: legal, technical, environmental, social and economic.

The MICC review categorized mining companies’ practices into:

Description Score
Acceptable 3
Minor Corrections 2
Major Reforms 1
Not Acceptable 0

The rating system provides a snapshot of the assessment after the Review Teams conducted their field visits, performed their analyses, and discussed with team-members and co-specialists.
In order to separate the mining companies that had the most problems from those with fewer issues, a 1.5 cut-off average score per aspect was determined as the threshold. This cut-off is fifty percent of the highest score of 3 as an acceptable level of performance.

Among the 26 mining companies, four, or 15% of the total, have legal rating that are lower than 1.5 – Zambales Development Mining Corporation, Claver Mining Development Corporation, Oriental Synergy Mining Corporation, and Mt. Sinai Mining Exploration and Development.

Four mining companies, also 15% of the total, have technical scores that are lower than 1.5 – Claver, Oriental Synergy, SinoSteel, and Ore Asia.
On the environmental aspect, eight (8) companies scored below the passing rating of 1.5. They are Claver Mineral Development Corporation, Wellex Mining Corporation Mine 1, Libjo Mining Corporation, Oriental Synergy Mining Corporation, Oriental Vision Mining Phil. Corporation, Sinosteel Phil. N.Y. Mining Corporation, Krominco Inc. and Ore Asia Mining and Development Corporation

The social aspect of the review showed that twelve (12) companies scored below the threshold. These are Benguet Corp. Nickel Mines, Eramen Minerals, Inc., LNL Archipelago Minerals, Inc., Claver Mineral Development Corporation, Carrascal Nickel Corporation, AAMPHIL Natural Resources Exploration and Development Corporation, Wellex Mining Corporation Mine 1, Wellex Mining Corporation Mine 2, Mt. Sinai Mining Exploration and Development, Emir Minerals Corp., Ore Asia Mining and Development Corporation and Strongbuilt Mining Development Corporation.

In terms of the economic aspect, only two (2) companies scored lower than the threshold. They are Oriental Synergy Mining Corporation and Ore Asia Mining Development Corporation.

Based on the Report, three (3) mining companies are most problematic for majority of the aspects reviewed. Three (3) companies, Claver Mineral Development Corporation, Oriental Synergy, and Ore Asia, have three to four average aspect scores that are less than 1.5. DENR Secretary Roy Cimatu issued order affirming the cancellation of the MPSAs/denial of MPSA application of these companies.
The MICC Report also includes case studies on the Economic Analysis of Specific Options for Selected Mining Companies. They are:

• Benguet Corporation, BC (gold mining) – alternative uses of the inactive Antamok for Benguet Water Supply or Engineered Sanitary Land Fill

• Oriental Vision Mining Philippine Corporation, OVMPC (nickel mining) in Dinagat Island – land use alternatives (agro-forestry)

• Hinatuan Mining Corporation, HMC (nickel mining)– alternative land use to mining in a small island setting

• Zambales nickel mines: Benguet Nickel Mines, Inc., BNMI; Eramen Minerals Inc., EMI, LNL Arhipelago Minerals, LNL Archipelago Minerals, In. LAMI; Zambales Diversified Minerals, ZDMC – management of silt that drain into common water bodies

• Strongbuilt Mining Development Corporation (magnetite/iron) – alternative scale combined with agricultural crop production

The Report generally showed that for the majority of mining companies, improvements in technical and environmental management practices need to continue and scale up.
It should be noted that the Report also acknowledged that there had been efforts by at least half of the companies to rectify and correct inappropriate practices.
Some policy recommendations mentioned in the Report include the development of guidelines for Care and Maintenance Period, retooling of the Multipartite Monitoring Team, implementation of a “one-stop” for mining permit and document processing, and the determination of minerals in direct-shipping ores (DSOs).
Sec. Cimatu already tasked the MGB to implement the recommendations of the MICC Review Team.