Philippines govt rejects SMI mining bidBy Edwin Espejo Jan 13, 2012 3:02PM UTC
The Philippine energy and natural resources department last week gave the thumbs down to the application of Sagittarius Mines Incorporated (SMI) for environmental clearance for its planned commercial production of copper and gold in the Tampakan, South Cotabato.
The department of energy and natural resources (Denr) cited the ordinance of South Cotabato which banned open pit mining in the province as the basis for rejecting the application.
“We are returning herewith the application documents with instruction to deny the same without prejudice to resubmit until the issues and concern on the use of open-pit mining method shall have been clarified and resolved by the company[SMI] with the provincial government of South Cotabato,” Denr secretary Ramon Paje said in a memorandum dated last January 3, copies of which were obtained by the local Catholic Diocese in South Cotabato.
Juan Miguel T. Cuna, director of the Environmental Management Bureau, then ordered Sagittarius Mines “to refrain from undertaking any development activity in the areas mentioned in the application for ECC” until it will be able to obtain the necessary permit.
The order was dated January 9 this year, several days after Paye issued his memorandum denying SMI’s ECC application.
The ECC is a mandatory requirement before any mining project could proceed.
SMI president Peter Forrestal said they were disappointed by the Denr decision but said they will seek reconsideration.
“SMI intends immediately to file an appeal for a reconsideration of the decision as permitted under the ECC application process,” he said even as he claimed the decision “was not made on the merits of our Mine Project Environmental Impact Statement (EIS), which fully complies with the requirements of the DENR’s own ECC process and is backed by a world-class environmental impact assessment study.”
SMI’s minority partner Indophil Resources, which only in December said it was confident the company will get an ECC, also confirmed the ECC rejection in a disclosure to the Australian bourse.
SMI held several public scopings and at least five public hearings during the last two years in a bid to obtain an ECC. These hearings drew partisan reactions from both pro-mining and anti-mining groups
The Bishop Dinualdo Gutierrez of the Diocese of Marbel hailed the decision, however.
Gutierrez, along with two other bishops in the areas where SMI planned to operate, is a strong advocate against open pit mining.
The militant Bagong Alyansang Makabayan (New Patriotic Alliance) said the rejection was a triumph for the people who opposed and rejected SMI’s bid to mine 2.4 billion tonnes at a grade of 0.6 percent copper and 0.2 grams per tonne gold and contains 13.5 million tonnes of copper and 15.8 million ounces of gold, using a 0.3 percent copper cut-off grade.
SMI earlier announced it intended to pour in US$5.4 billion in capital and cash investments for the project.
National mining policy
Forrestal said the Denr decision “sets a precedent that contradicts the publicly stated views of the Aquino Administration.”
The Aquino government however said it is yet to come up with a comprehensive policy recommendation on the mining industry following increased environmental concerns from several sectors.
Meanwhile, the Chamber of Mines in the Philippines today said “the denial of the application for an Environment Compliance Certificate (ECC) for the Tampakan Mine Project underscores the urgent need for a national mining policy that would resolve conflicts between the national government and local government units as regards minerals development.”
The Philippine mines chamber also warned that the denial of SMI’s ECC application may send mixed signals to the investment community.”
The Denr decision came just days after a local trial court restrained the provincial government of Zamboanga del Norte from enforcing its own open pit mine ban which affected the ongoing operations of Canadian-owned TVI Resources Development.
SMI however has refused to challenge the provincial ordinance saying that it was just a contractor under the Colombio Financial Technical Assistance Agreement which holds the Tampakan Copper and Gold Project.
Aside from the Catholic Church and environment groups, the communist-led New People’s Army is also against mining large-scale mining operations.
In October last year, some 200 NPA guerillas raided Taganito Mines and two other sister companies in Surigao del Norte torching over US$20 billion of equipment and properties.