The curious case of the mining audit

  • Sep 12, 2019
  • BusinessMirror

The long-delayed publication of the mining audit by the Department of Environment and Natural Resources (DENR), which should provide transparency on which mining firms have been cleared to operate, remains contentious, as the agency’s Undersecretary Analiza Rebuelta-Teh continues to keep mum when pressed by reporters why the audit remains a secret. Teh heads the agency’s Climate Change Service and Mining Concerns.

Reporters who buttonholed Teh on Tuesday at the sidelines of the Mining Philippines 2019 International Conference and Exhibition in Sofitel Philippine Plaza, Pasay City, couldn’t get her commitment as to when the audit would be made public.

BusinessWise, however, was able to get a copy of the complete audit (a 5-inch thick document) from DENR insiders and published the list of miners that passed the grade in a previous column, “Mining industry in limbo.” The succeeding column, “Miners cry injustice,” cited that Department of Finance (DOF) Undersecretary Bayani Agabin confirmed the authenticity of the list in a phone interview.

In the list obtained by this paper, 24 mining firms out of the 27 that were ordered shut down in 2017 have been given the green light; the other three failed the audit.

During Tuesday’s mining forum, Teh revealed that the “suspension” of mining operations of two companies may soon be lifted, namely: Zambales Diversified Metals Corp. (ZDMC) and Strong Built Mining Development Corp. (SBMDC). She said that the others will still have to be evaluated whether they have complied with the corrective measures.

Note here that Teh was talking about suspension, while the audit concerns the shutting down of mining operations. To recall, then DENR Secretary Ramon Paje ordered the suspension of several mining companies due to environmental concerns. When the late Gina Lopez took over the helm of the DENR, she expanded the list and included those which she claimed to be sitting on watersheds. Lopez shut down—and not merely suspended—the operations of these mining companies, a move that was even harsher. The third-party audit focused on the mining firms that have been shut down, and not just suspended.

Technically, Paje’s suspension order should have already been superseded by whatever outcome the audit would lead to. Those mining firms ordered “suspended” during Paje’s time which passed the audit should have already been cleared to operate. In echoing this opinion, a source at the Mines and Geosciences Bureau (MGB) said that the audit is all encompassing, and the results should have already addressed all pertinent environmental issues.

To those who may not have read my previous column, here’s the list of miners and their respective scores. They were assessed based on the criteria and the benchmarks on social, technical, legal and environmental aspects of their operations. Agabin said: “The system was such that three is the highest score; two is minor reforms needed, [and] one is for major reforms. Zero is not acceptable…the passing score is 1.5.”

The 24 miners that passed the audit were: Oceana Gold Philippines—2.92; Hinatuan Mining Corp.—2.74; CTP Construction and Mining Corp.—2.46; Emir Minerals Corp.—2.44; Lepanto Consolidated Mining Corp.—2.30; Marcventures Mining and Development Corp.—2.30; AAMPHIL Nat. Res. Exploration 2B—2.28; Adnama Mining Resources Inc.—2.24; Citinickel Mines and Development—2.24; Berong Nickel Corp.—2.20; Strongbuilt Mining Development Corp.—2.16; Wellex Mining Corp. Mine 2—2.16; Carrascal Nickel Corp.—2.14; Eramen Minerals—1.90; Wellex Mining Corp. Mine 1—1.90; Libjo Mining Corp.—1.84; LNL Archipelago Minerals Inc.—1.78; Benguet Corp.—1.74; Krominco Inc.—1.68; Mt. Sinai Mining Exploration and Development—1.68; Zambales Diversified Metals Corp.—1.68; Benguet Corp. Nickel Mines Inc.—1.64; Oriental Vision Mining Philippine Corp.—1.64, and Sinosteel Philippine, NY, Mining Corp.—1.62.

The three miners that failed the audit were: Oriental Synergy Mining Corp.—1.10; Ore Asia Mining and Dev. Corp.—0.96, and Claver Mineral Development Corp.—0.78.

While their operations remained closed, the government allowed some of these companies to continue exporting their stockpiles, to which the late Gina Lopez grudgingly acceded to. Keeping the excavated minerals at the respective depot is an environmental concern. Now that their stockpiles are running low, the miners cleared by the audit are at a loss as to what happens next.

“It’s been almost two years since we’ve been cleared,” an industry source lamented, “but we remain inactive, all the while paying our creditors, employees and contractors. The hemorrhage is so severe that we don’t know any more what to do to stop the bleeding. The government should at least tell us what our next step is, whether we stay or not. We could not remain in limbo forever.”

Asked by reporters why the DENR has not made the audit public, Teh said that it was the DENR which proposed it “because several companies have requested for a copy of the full report and…pursuant to an executive order on the right to information and state policy on full disclosure, there’s a provision there that, because we have submitted the report to the Office of the President [OP], and it is recommendatory in nature, we cannot disclose the full report.”

Teh was silent when asked why the audit was directly submitted to the OP and not to the affected mining firms, which are demanding full transparency. My industry source asked: “Without the audit results, how do we address the findings or vindicate ourselves of the closure charges of DENR Secretary Gina Lopez [and prove] that [we] were wrongfully and arbitrarily closed? Has government deprived the industry of due process for the second time? Is government afraid to be sued for damages resulting from the audit which will acquit the miners of wrongdoing?”

BusinessWise tried but failed to get Teh’s side as her two listed phone numbers remained unanswered between 9 a.m. and 11 a.m. on Tuesday. I would have wanted to ask her the following questions, and her responses would have helped enlighten the industry about this issue once and for all:

1. Which among the mining firms subjected to the audit have been granted the green light to resume normal operations, including mining, hauling and exporting?

2. Why have some companies which passed the audit been prevented from resuming normal operations?

3. Which companies have been allowed to return to normal operations, and which ones have not been cleared?

4. For those companies that have passed the audit or been granted Stay Orders from the OP, will the DENR-MGB now release the issuance of Ore Transport Permits and Mineral Ore Export Permits, or will these permits continue to be withheld? Why or why not?

It is deplorable how the huge potential of the country’s mining industry remains untapped, and mired in a cobweb of neglect.

For comments and suggestions, e-mail me at [email protected]

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