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Philippine Mine Safety and Environment Association and Philippine Society of Mining Engineers

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Title: Philippine Mine Safety and Environment Association and Philippine Society of Mining Engineers


1
The Challenge of Mineral Wealth Promoting
Responsible Mining in the Philippines
  • Horacio C. Ramos
  • Director
  • Mines and Geosciences Bureau
  • Department of Environment and Natural Resources
  • November 17, 2006

2
Executive Summary
  • INDUSTRY PERFORMANCE AND STATUS
  • PRIORITY MINERAL EXPLORATION AND DEVELOPMENT
    PROJECTS
  • INDUSTRY COMPETITIVENESS FROM THE POINT OF VIEW
    OF SOME FOREIGN INVESTORS
  • DENR POLICY REFORMS AND DIRECTIONS

3
INDUSTRY PERFORMANCE AND STATUS
4
MINING INDUSTRY STATISTICS 2005
5
OPERATING MINES
1 Polymetallic Mine Rapu rapu mine
2 Large scale Mines
Victoria Gold Mine
Padcal Copper Mine
4 Medium-scale Chromite Mines
Masinloc Project of Benguet Corp.,
Omasdang Project of Crau Minerals
Homonhon Project of Heritage Res.
Redondo Project of Krominco, Inc.
5 Medium-scale Nickel Mines
Rio Tuba Nickel Mine
Taganito Nickel Mine
Cagdianao Nickel Mine
Sigbanog Project of HMC
Tagana-an Project of HMC
4 Medium-scale Gold Mines
Canatuan Project of TVI
Acupan Gold Operations of Benguet
Diwalwal Direct State Development Project
Banahaw Gold Project, Philsaga Mining Corp.
15 Cement Plants and Quarries
1 Nickel Processing Plant (HPAL)
1 Copper Smelter (PASAR)
2000 Quarries and small scale mines
6
APPROVED TENEMENTS (as of 09/06)
Area coverage (including other mining permits) is
515,413 hectares or around 1.7 of total
Philippine land area.
7
PRIORITY MINERAL EXPLORATION AND DEVELOPMENT
PROJECTS
8
24 Priority Projects
9
PRIORITY MINING PROJECTS
10
PRIORITY MINING PROJECTS
11
(No Transcript)
12
41 Exploration Projects
13
INDUSTRY COMPETITIVENESS FROM THE POINT OF VIEW
OF SOME FOREIGN INVESTORS
14
THE FRASER INSTITUTE SURVEY PROFILE
15
RP Score and Ranking (Fraser Surveys, 2001-2005)
1. Policy Potential Index -how attractive a
jurisdictions policies are from the point of
view of exploration managers)
2. Current Mineral Potential Index based on an
executives perception of geology under current
policy environment
3. Pure Mineral Potential assuming best
practices policy regime
16
Summary of RP Ratings, By Factor (Fraser Surveys)
17
MUCH REMAINS TO BE DONE
  • The Survey acknowledges some anomalies (e.g.
    conflicting beliefs) and a caveat that response
    may have been influenced by personal experiences.
  • BUT the Survey is significant because ranged
    against other mining jurisdictions, the
    Government is given an idea of what it is doing
    right or doing wrong.
  • The Survey identified areas where attention
    should be focused.

18
MUCH REMAINS TO BE DONE
  • The Study affirmed the countrys geological
    prospectivity, considered as the most important
    criteria for investors.
  • On the local front
  • The law is sufficient, implementation is the
    key
  • DENR/MGB Cant effectively enforce the law, due
    to lack of resources
  • - P. Wallace, July 2006, Briefing to ANZCham
  • Potential FDI in Mining Per Year (2007 2010)
    Pessimistic Scenario 125M Status Quo Scenario
    375M and Optimistic Scenario 1.25B
  • - R.Blume, Workshop on FDI, October 2006
  • a seeming policy shift from active promotion of
    the previous two years to one of cautious
    re-consideration of policy reforms
  • - Chamber of Mines of the Philippines, 29
    August 2006 letter to H.E., President
    Gloria Macapagal-Arroyo

19
MUCH REMAINS TO BE DONE
  • Reforms are not easy no straight path
  • Differing perspectives and interests to balance
  • The Government is just part of the equation
  • Putting principles into practice is a task of the
    company

20
MUCH REMAINS TO BE DONE
  • We realize the need to transform these
    minerals into economic wealth to make them useful
    for our development as a nation and to enhance
    the quality of life of our people.
  • We know that these minerals will not have
    any significant value for as long as they are not
    converted into their commercial form to generate
    the necessary revenues for driving the national
    economy and developing our communities.
  • - ENR Secretary Angelo T. Reyes during the
    Indaba Conference
  • That is the CHALLENGE OF MINERAL WEALTH that the
    Government has COMMITTED itself to do.

21
DENR POLICY REFORMS AND DIRECTIONS
22
DENRS 12-POINT AGENDA
II. SUSTAINABLE EXPLORATION AND DEVELOPMENT OF
THE COUNTRYS NATURAL WEALTH 6. Revitalize
responsible mining through the development of 24
medium and large-scale mining projects and the
clean-up and rehabilitation of abandoned and idle
mines especially the Bagacay mines in Samar and
Marcopper mines in Marinduque. Generate
US1.8 billion in investments over the next five
years.
23
REVITALIZATION PROGRAM
  • Revisiting of the 24 Priority Mining Projects to
    include new projects that have potentials of
    contributing to the goals of the program and to
    de-list projects that have already commenced.
  • Institute the Use It or Lose It Policy to weed
    out non-performing mining tenements and focus on
    serious, technically competent and financially
    capable mining contractors.
  • Review of the Mineral Action Plan to track down
    accomplishments and to review and identify
    gaps/concerns that need attention.
  • Development of an Industrialization Plan to find
    ways to promote the development of upstream and
    downstream industries.
  • Invigoration of the Minerals Development Council
    (MDC).
  • Touching base with civil society groups (e.g.
    Bishops-Businessmens Conference) for stakeholder
    dialogues.

24
CONTINUING POLICY REFORMS
  • FURTHER AMENDMENTS TO DAO 96-40
  • Increase in the amount to implement the Social
    Development and Management Programs of mining
    companies.
  • Development of the guidelines for Joint Venture
    Agreements and Co-Production Agreements.
  • Review of the Fiscal Regime of FTAA to ensure
    equitable Government Share in mining operations.
  • Streamline the procedure in the grant of mining
    tenements.
  • STRENGTHEN PERMITTING PROCEDURES
  • Institution of mandatory Notice To Proceed
    after approval of Declaration of Mining Project
    Feasibility or MPP but prior to commercial
    operation
  • Strengthen current mechanism in the evaluation of
    Mining Project Feasibility Studies
  • Increase fines and penalties for violations of
    various environmental standards

25
CONTINUING POLICY REFORMS
  • IMPROVE ENVIRONMENTAL MONITORING SYSTEMS AND
    STANDARDS
  • Institute 3rd party Environmental Audits
  • Update and expand coverage of DENR Standards
  • Providing for Resident Government Mine Inspectors
  • CAPACITATE THE DENR TO BETTER PERFORM ITS
    FUNCTIONS
  • Develop technical capability of DENR Regional
    Offices in regulating and monitoring mining
    operations
  • Conduct on-the-job training in all aspects of
    mining operations
  • Formulate and implement a comprehensive training
    module for mine inspectors
  • Set-up and upgrade DENR laboratory facilities in
    all regional offices

26
IN CLOSING
(W)e are promoting a revival of mining in the
Philippines to take advantage of the economic
benefits that can be derived from the development
of these resources, especially at this time when
mineral demand is historically high and prices
are in favor of mineral producers.
HOWEVER, (T)he Philippine Government is
revitalizing mining not purely for the expected
economic benefits but with due and equal regard
for the environment and the communities.
27
Maraming salamat po!
www.DENR.gov.ph Department of Environment and
Natural Resources
www.MGB.gov.ph Mines and Geosciences Bureau
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