The Philippines’ environment minister this week extended the crackdown on the nation’s mining industry by ordering the cancellation of 75 mineral production sharing agreement (MPSA) contracts. This steps up a campaign to stop extraction of resources in sensitive areas and follows the closure of more than half of the country’s operating mines.
The contracts are all said to be in watershed zones, with many in the exploration stage. They cover projects not yet in production and the action by Environment and Natural Resources Secretary Regina Lopez, supported by the country’s President, indicates she will not allow them to be developed further.
“You kill watershed, you kill life,” Regina Lopez told a media briefing. Earlier this month she ordered the closure of 23 of the Philippines’ 41 mines for damaging watersheds and for siltation of coastal waters and farmlands with another five suspended.
President Rodrigo Duterte said he would not stand in the way of the decision to shut several mines in southern Philippines, the second time he has thrown his support behind the minister he appointed last June.
On Tuesday Regina Lopez said she had served notice to operators of dozens of mines, asking them to explain why their permits should not be cancelled for operating in watersheds. The ‘show cause’ orders were given to 37 mines in Mindanao, 27 in Luzon and 11 in the Visayas.
The MPSA ordered cancelled include the $5.9 billion Tampakan copper-gold project in South Cotabato province on Mindanao island, the biggest stalled mining venture in the country. Tampakan failed to take off after the province where it is located banned open-pit mining in 2010, prompting commodities giant Glencore to quit the project in 2015.
“We’re cancelling this as a gift of love to the people of Cotabato,” Regina Lopez said.
She made a case against Tampakan, which has the potential to be the country’s single biggest foreign direct investment. She said the project would damage a land area as large as 700 football fields and would generate only 2000 jobs despite its US$5.8 billion price tag.
Some miners facing a shutdown of their operations have threatened legal action, with some miners saying they had received a formal closure order from the environment agency.
The Chamber of Mines of the Philippines said the orders would affect 1.2 million people. It said the orders would cost affected local governments in 10 provinces over P650 million yearly in foregone revenues based on estimates by the finance department.
The Philippine Chamber of Commerce and Industry (PCCI) said the DENR decision was expected to take a heavy toll on the country’s trade and investment image, and it appealed to President Duterte to step into the matter.
The PCCI said Regina Lopez issued the cancellation orders despite her being a signatory to a resolution by the Mining Industry Coordinating Council (MICC).
“Due process and multi-stakeholder reviews were guaranteed by DENR Secretary Lopez herself and other MICC members just days before the new cancellations orders,” PCCI president George Barcelon said. “She herself signed the MICC resolution and now it is not followed.
“How can a company risk stockholders’ money in projects if the investment rules are unclear and uncertain,” he said.
“We hope the President could consider moving on this issue of due process quickly because investors could put on hold their investments decisions,” he added.