By Jonathan L. Mayuga
The government is committed to protect mining investments in the Philippines, Director Leo Jasareno of the Mines and Geosciences Bureau (MGB) of the Department of Environment and Natural Resources (DENR) said on Monday.
Mining investments in 2014 only reached $693 million, or 76 percent, short of the government’s own original projection of $3 billion, which the Chamber of Mines of the Philippines partly blamed on the alleged lack of protection the Aquino administration provides to mining contractors.
The group, represented by large-scale mining companies, also questioned the wisdom of Executive Order 79, which calls for, among others, increase in government share in mining profit.
In an interview, Jasareno said the Philippines will continue to attract mining investors given the country’s rich mineral deposit mining companies are looking for. He added that adequate policies are in place to protect foreign investment in the country, including mining.
He, likewise, cited the case of the $5.9-billion Tampakan Copper-Gold Project in Mindanao, wherein the government created a committee on peace and security to address the problem.
The multibillion-dollar copper-gold project remained stuck, owing to permitting problems. It is also besieged by stiff opposition of communities to mining. Jasareno, however, said he remains confident that the project will eventually push through.
He said that the government is bent on pursuing the project through the Mining Industry Coordinating Council, of which the DENR-MGB sits as member.
Late last year, the MGB flashed the green light for the commercial operation of the $2-billion King-king Copper-Gold Project in Pantukan, Compostela Valley Province, and the $850-million Silangan Gold Project in Surigao Province.
“The underlying principle in attracting foreign investment in the Philippines is protection for their investment. This means, ’pag nag invest ka sa Pilipinas, the government will protect your investment,” Jasareno said.
President Aquino himself, he added, has personally assured mining companies that their investment will be protected during the Presidential Mineral Industry Environmental Awards Ceremony held at the Malacañan Palace on January 20.
In his speech, Mr. Aquino reminded mining companies of their responsibility, citing the destructive potential of irresponsible and unregulated mining. Nevertheless, he said the value of mining that is done responsibly—under fair and effective government regulation—cannot be ignored.
“The Philippines, after all, is one of the most mineral-rich countries in the world, and I believe it to be government’s responsibility to pave pathways through which our countrymen can benefit from our natural resources in a responsible and sustainable manner,” Mr. Aquino said in his speech.
A bigger challenge for the government today, Jasareno said, is to enhance its power generation capacity to pave the way for mining investment to flow in. Mining companies, he said, also look at available infrastructure, such as seaports and roads, but most companies partly invest in these development projects, after weighing costs and benefits of such investment requirement.
Mining companies that plan to invest in the Philippines consider the energy requirements of their projects, first and foremost, particularly in Mindanao, Jasareno said. “You need power to operate a mine. Mining companies know that,” he pointed out.
“The Tampakan project, for example, is not just a mining project. It is also a power-plant project,” Jasareno said.
The proponents of the Tampakan project is also planning to build a 400-megawatt coal-fired power plant to sustain its mining operation. According to Jasareno, to boost the country’s annual metals output, it needs to attract more investors to operate large-scale mines and sufficient supply of electricity to sustain operation.
The 2015 metals output is expected to go down by 20 percent owing to the depressed prices of gold, silver copper and nickel. The MGB reported that January to September metals production went down from P107.24 billion in 2014 to P85.78 billion in 2015, recording a P21.46-billion decrease.