* Written on April 18, 2013.
Here is a short timeline of various policies governing the mining industry in the country. I saw a rappler report on timeline mining. It was highly incomplete though as there are many other DENR Administrative Orders (DAO) and Department Memorandum Circulars (DMCs) affecting the industry. I skipped several DAOs and DMCs in producing this list.
Presidential Decree 1899, January 23, 1984
Defining small-scale mining as “artisanal”, thus disallowing sophisticated equipment, involving minimal investments in infrastructure and processing plants, and relies on manual labour.
Republic Act 7076, June 27, 1991
People’s Small Scale Mining Act of 1991, “Minahang Bayan.” Forms the Provincial/City Mining Regulatory Board that supervises small scale mining operations alongside the chiefs of the Environment Department and Mining Bureau.
Department Administrative Order (DAO) 1991-66, December 27, 1991
Declaring certain parcels of Agusan-Davao-Surigao Forest Reserve as non-forest land open for small-scale mining. Parts of Diwalwal gold-rush area in Davao region was open to small-scale mining.
DAO 1992-34, July 14, 1992
Implementing Rules and Regulations (IRR) of RA 7076.
RA 7942, “Philippine Mining Act of 1995”, March 3, 1995
Liberalizes foreign investments in the sector, involves the Local Government and Indigenous Cultural Communities in minerals exploration. Followed by a Financial and Technical Assistance Agreement (FTAA) with foreign-owned Western Mining Corporation Philippines (Tampakan mine).
DAO 1995-23, August 15, 1995
Implementing Rules and Regulations (IRR) of RA 7942.
Jun. 19, 1995
La Bugal-B’laan Tribal Association questioned the Constitutionality of RA 7942 and its IRR, particularly the FTAA, which allows foreign ownership, before the Supreme Court.
Revised IRR of RA 7942.
Proclamation No. 297, November 25, 2002
Establishing the 8,100-hectare Diwalwal Mineral Reservation.
Joint MC DENR-DTI 2003-02, September 10, 2003
Establishment of a Mining Investment Assistance Center.
SC ruling, RA 7942 as unconstitutional, January 2004
The Supreme Court en banc said the Mining Act of 1995 is unconstitutional since it allows foreigners to engage in mining through FTAAs, which is contradictory to the 1987 Philippine Constitution.
SC reverses, declares RA 7942 as constitutional, December 2004
The Supreme Court reversed previous decision on the unconstitutionality of the Mining Act. Associate Justice Artemio Panganiban pens a resoution that says “full control is not anathematic to day-to-day management, provided that the State retains the power to direct overall strategy”. This gives the government a go-signal to issue FTAAs.
DAO 2007-15, July 19, 2007
Amendments to DAO 96-40.
DMO 2009-01, January 30, 2009
Delegating the authority to issue Mineral Ore Exports Permit to the Provincial Governors concerned.
DMO 2010-08, June 29, 2010
Consolidated DAO re IRR of RA 7942.
DMO 2011-01, January 18, 2011
Suspension of acceptance of all mining applications.
EO 79, July 06, 2012
Institutionalizing and implementing reforms in the Philippine mining sector.
Imposes a moratorium on new mining contracts, creates the Mining Industry Coordinating Council (MICC). identify no-go areas for mining. (7 pages)
DAO 2012-07, September 10, 2012
Implementing Rules and Regulations (IRR) to EO 79 (16 pages)
DMO 2013-01, February 21, 2013
Increasing the minimum capital requirements for mining applicants – EP, MA, FTAA.
Authorized capital from P10 million to P100 million.
Paid up capital from P2.5 million to P6.25 million.
DAO 2013-10, February 21, 2013
Increasing fees for mining applications.
Exploration Permit (EP) from P60/hectare but not less than P50,000 per application, to P300/hectare but not less than P200,000 per application.
Mineral Agreement (MA) from P60/hectare but not less than P50,000 per application, to P300/hectare but not less than P300,000 per application.
FTAA from P60/hectare but not less than P190,000 per application, to P300/hectare but not less than P500,000 per application.
Yesterday, Teddy Casino, Senatorial candidate of Bayan Muna/Makabayan Coalition, posted this in his facebook page,
We recently challenged provisions of the Mining Act of 1995 in court.
Ang pagmimina ay dapat bahagi ng isang National Industrialization Policy para matiyak na napapakinabangan ng mga Pilipino ang ating yamang mineral, at minimal ang negatibong epekto nito sa kapaligiran at mga komunidad.
Read the full statement: http://ow.ly/k6Ibm
I commented on it, I wrote that “Government collects about 43% of the net revenues of big metallic mining firms. But government collects zero from small-scale metallic mining, and 9% from net revenues of non-metallic mining firms.
A supporter of Casino defended him, below are our exchanges:
Leon Dulce Para-Sa Kalikasan But its contribution overall is only 0.91% to GDP, 2.5% in total investments and 0.38% to total employment. At hindi lang taxation ang usapin sa large-scale mining.
Nonoy Oplas The contribution of mining to GDP is similar to raw agriculture. Chicken sold at wholesale price would cost only about P100 each on average, that’s the agri share to GDP. When the same chicken is sold as litson manok and sold at P212 (Andok’s or Baliwag litson), the P112 value added is counted as service sector share to GDP.
Copper, nickel, iron, when sold as ordinary stones or soil, is priced relatively low. But without these mineral products, there will be no construction and steel industry, no electricity and power industry, no tv/cellphones/radio/various electronics industry.
Leon Dulce Para-Sa Kalikasan Minerals are finite and should be utilized based only on the needs of the people, with the environmental and socio-economic concerns of communities in mind, and with a national industrialization plan in mind.
But as it stands, ores and huge profits are exported while the people are left with literally crumbs. And poison. Look at Padcal Mines in Benguet. Look at Citinickel Mines in Palawan. These are just recent cases. Paano yung long-standing and unresolved like Marcopper?
Mining by TNCs are not bringing in the revenue and safety as advertised. Mining should the public’s, no one else.
Please read the article linked above in sir Teddy’s caption before rehashing the tired, old lines about “no laptops if no mining.”
Nonoy Oplas I read Casino’s statement and it’s lousy. As I noted above, tax payment by small scale metallic mining in 2010 was zero vs. P12 billion by big metallic mining, constituting 43% of their net revenues. Why is Casino silent on zero taxes, all extraction only by so-called “small scale” mining but are actually “big politicians mining”.
Mineral deposits are infinite. Magma, gases and geological movement from the planet’s core to the mantle up to the crust, mineralizes ordinary rocks and soil. That is why countries in the Pacific Rim of Fire have more mineral deposits than those in Africa, Europe, S. America and N. America atlantic side. A mining engineer from UP Diliman showed slides about this, http://funwithgovernment.blogspot.com/2013/03/mining-8-supreme-court-hearing-on-ra.html
Leon Dulce Para-Sa Kalikasan Ooh, geologists and mining engineers! Let’s wait for the millions of years needed to renew minerals through the continental drift. In the meantime, let’s be contented with the poverty incidences that remain highest in mining-affected communities, according to UPSE economists.
Nonoy Oplas I saw Rio Tuba Nickel Mining in southern Palawan. That small barrio has more shops, more cemented roads, wide street lights, a La Salle-administered private elementary and high school and it’s free for all of its students, a modern private hospital and it’s free for all patients. So the “poverty incidences that remain highest in mining-affected communities” is fiction story by some emotional environmentalists. A few kilometers outside Brgy Rio Tuba, even in the municipal proper of Bataraza, there is more poverty, more unemployment, zero hospital available. See the photos and you will fume more, http://funwithgovernment.blogspot.com/2013/03/mining-8-rio-tuba-mining-in-south.html
Casino said, ” Under the MPSA and FTAA schemes only guarantee the country miniscule revenue in allowing foreign corporations to extract our finite mineral resources that does not augur well for our national economy.”
P12 billion collections by the government, local and national, from big metallic mining in 2010 alone, is “miniscule revenue”? So what does Casino call the zero tax payment by “big politicians mining aka small scale mining”, maybe he’d call it “giant air revenues”? In 2010, small-scale gold mining produced an estimated P43 billion gross production and paid zero tax. Even the BSP buys about 60 percent of its gold requirements from these so-called “small scale mining”.
Is Casino now among the spokesperson of “big politicians aka small scale mining” for being silent in their zero tax payment big business? But I thought Casino wants more tax-tax-tax to finance his nationalist-socialist agenda.
Meanwhile, from the Business Mirror article posted by Leon above, Mining Act assailed by NGOs anew, I am lifting these paragraphs and numbered them as I have a comment in each of them.
(1) The Kalikasan-People’s Network for the Environment (Kalikasan-PNE) said the law has only cleared the path for foreign exploitation of the country’s natural wealth and did not contribute much to national or local economic development of host communities as promised by both the government and its contractors.
(2) According to Clemente Bautista, national coordinator of green activist group Kalikasan-PNE, mining still contributes a very meager amount to the country’s gross domestic product (GDP), proving that mining only “profits big companies.”
(3) “Only a nationalist mining industry can truly benefit the Filipino people,” Bautista added.
(4) Based on government data from 2000 to 2009, the average contribution of mining to the GDP was only 0.91 percent, 2.5 percent to total investments and only 0.38 percent to total employment.
(5) The ratio of government tax collection from mining to the total mineral production also shows minimal contribution, as the government only collected 7.6 percent, or P64.2 billion, of the mining industry’s total mineral production of P842 billion from 1997 to 2010, Bautista said.
My comments are as follows:
On (1), “foreign exploitation of the country’s natural wealth”, I thought that majority of the big mining firms here are locally-owned with a minority foreign equity ownership. Philex Mining for instance is owned by the Manny Pangilinan group. Sagitarrius Mines Inc (SMI/Tampakan) is mainly foreign, allowed under the FTAA scheme.
“…did not contribute much to national or local economic development of host communities” is wrong. I mentioned the case of Rio Tuba in Palawan above.
On (2), “mining only ‘profits big companies.’” See again this table that I posted earlier.
source: Dr. Artemio Disini, presentation at the Philippine Economic Society (PES) Conference, November 27, 2012, PICC, Manila.
Out of an estimated P30 billion net revenue by “small scale gold mining” in 2010, tax payment was zero. Why is Bautista silent about it? He will simply not admit that it only “profits big politicians aka small scale gold mining”.
On (3), “nationalist mining” is already happening. Go to Diwalwal, there is not a single foreign corporation involved there, only Filipino nationals. How has it “truly benefit the Filipino people”?
On (4), here is Philippine GDP by industrial origin at constant prices, percent distribution
|Agriculture, fishery & forestry||13.4||11.4|
|Gross Domestic Product||100.0||100.0|
Source: computed from NSCB table 1, http://www.nscb.gov.ph/beyondthenumbers/2013/04122013_jrga_agri.asp#tab1
It is true that the share of raw mining production (big metallic mining + small gold mining + non-metallic mining) is small relative to GDP. But without those raw mining production, say ALL mining activities in the Philippines and the world will be stopped, then there would be no other industrial production (construction, electricity, metal manufacturing, auto and tricycle production, etc.). And services sector will also be very small – no retails and wholesale as there will be no malls, no ships, trucks and cars produced, and so on.
Back to the example of chicken farming again. The value of live chicken production (under the Agriculture sector) is small relative to GDP but without these, there would be no litson manok, carinderia and restaurant business that sell chicken curry/chicken tinola/chicken adobo, etc. Raw production of mineral, agricultural and fishery products create huge opportunities in the downstream sectors and industries. So one can not belittle or pooh-pooh the “small production share” of mining, agri, and fishery.
On (5), check again the table on mining taxation above. They complain of the P64 billion tax collection from big metallic mining but are silent about the zero tax collection from “small scale” gold mining. Hypocrisy is clearly shown by this silence.