LRC-Luzon Regional Office

Monday, May 22, 2006

Bishop miffed by Palace stand re Lafayette

Arroyo’s stand favoring mining miffs bishop
‘What’s use of study if she doesn’t follow it?’
By Christian V. Esguerra
Philippine Daily Inquirer May 22, 2006
http://news.inq7.net/archive_article/index.php?ver=0&index=1&story_id=76557

THE HEAD OF THE fact-finding body that investigated Australian mining operations on Rapu-Rapu Island yesterday said he would write a “strongly worded” letter to President Gloria Macapagal-Arroyo if she ignores the panel’s recommendation to stop mining on the island.

Sorsogon Bishop Arturo Bastes chaired a nine-member commission that looked into the Rapu-Rapu mining operations in Albay province following two incidents of tailings spills that residents had blamed for fish kills in their area.

“If she will not follow our recommendations, I will write a letter, a strongly worded letter … What is the use of having a study if she does not follow it?” the Roman Catholic prelate said in an interview over the Church-run Radio Veritas.

The Bastes commission had called on the government to cancel the environmental compliance certificate issued to Lafayette, stop mining operations in Rapu-Rapu and review the Mining Act, especially its provisions on ownership and management of mining companies and operations.

Lafayette said the commission’s report was “unscientific and flawed.”
In a statement, the company said the commission “disregarded several independently conducted scientific studies saying that there was no mercury contamination of the coastal areas of Sorsogon (province). But the report insisted that the fish scare was true and was caused by Lafayette.”

Bishop Bastes made his statements when asked on Veritas for his reaction to Malacañang’s “rejection” of his panel’s recommendations.

Press Secretary Ignacio Bunye had said that banning mining was not the answer to the problem and that it would be “a disservice to our people if our full mineral potential is not realized as this is clearly a source of employment and development.”

Bastes clarified that the commission was not against mining “per se” but only against the conduct of Lafayette’s operations in Rapu-Rapu.
“There is a possibility that in other places in the Philippines, the situation is different so mining should go ahead,” Bastes said. “But in this particular case (Rapu-Rapu), definitely we want them to stop.”
A central concern raised by the commission was the purported presence of acid mine drainage (AMD) in the mining area, which Bastes said “brings heavy toxic metals to the sea and to all the water areas.”

In the report, the commission expressed concern over whether Lafayette was able to control AMD or was, in fact, “aggravating AMD and all its harsh effects.”

The commission noted that “subaquaeous deposition,” the means adopted by the company to prevent the presence of AMD, was not used in hilly terrains like Rapu-Rapu. Citing a number of scientific studies, it said the system was effective only in flat terrain.

“Lafayette designed strategies without yet thoroughly understanding the nature and potentials of AMD in its mine site, in particular, and in the Rapu-Rapu environment, in general,” the commission said.
“This is a serious problem that must not be taken lightly,” Bastes said.

Mining companies elated
The prelate also disputed claims that mining would greatly spur the economy.

He said local residents, like those of Rapu-Rapu, received no share from the benefits of mining in their areas unlike people in other countries.
“How can we say that with this kind of practice, mining is the savior of the economy and the country?” the bishop said.

In a statement, the Chamber of Mines lauded the government for “continuously supporting the mining industry.”

“The decision allowing foreign investments in the industry would ensure the flow of $10 billion in investments into the economy with the planned expansion of existing projects and the operation of new ones,” chamber president Benjamin Philip Romualdez said in a statement.

Clear signal
Canadian firm Toronto Ventures Inc., one of the biggest foreign firms in the country which operates a gold project in Zamboanga del Norte province, said the government could now focus on the effective regulation and implementation of the mining law.

“The government’s position sends a clear and welcome signal to the international community that the Philippines is committed to attracting mineral explorers and developers who can bring in major investments but who also subscribe to the principles of sustainable development,” TVI said in a statement.

Romualdez said Philippine mining laws already included best-practice guidelines and standards to address the environment, health and safety concerns of communities that host mining projects.

“It is important that close monitoring of mining activities is in place and this is where other stakeholders can contribute,” Romualdez said.
Atlas Consolidated Mining and Development Corp., which has received fresh funding toward reviving its copper mines in Toledo, Cebu, said its experience had shown that mining projects could boost the economy in the form of jobs, taxes and community projects.

“We support Malacañang’s desire for responsible mining, which means sustainable development with care for the environment and the safety of our miners,” Atlas president Alfredo Ramos said.

Lafayette statement
In its statement sent to the Inquirer, Lafayette said the Bastes commission relied on “anti-mining theories and feel.”

“It boggles the mind how a hoax is given credence while the work of independent scientists is disregarded,” Lafayette said.

“Besides, how can we cause mercury contamination across the sea (the Rapu-Rapu project is in Albay) when we don’t use mercury and Rapu-Rapu itself has no mercury problem?”

Lafayette said the commission even admitted that although the basis of its findings “made by different groups may not be conclusive and need further studies to connect to observed immediate effects of the tailings incidents, the commission feels that there is a high probability of connection … (resulting in) health, environmental and economic problems to the people of Rapu-Rapu and nearby coastal municipalities of Albay and Sorsogon.”

The company said fact-finding bodies “should not go by feel and probability … because so much is at stake -- the interest of the 1,000 employees of the company and their families, the host communities, the allied businesses to be generated in the Bicol region and the whole country in terms of taxes and investor confidence.”

Sunday, May 21, 2006

No mining ban, Foreign firms stay

Palace: No to mining ban
Foreign firms stay; industry still gov’t priority
By Gil C. Cabacungan Jr.

Philippine Daily Inquirer May 21, 2006
http://news.inq7.net/archive_article/index.php?ver=0&index=1&story_id=76462

SAYING a ban was not the answer, Malacañang yesterday stood firm on its policy allowing big foreign companies to operate mines despite recommendations to stop Australian mining activities on Rapu-Rapu island and review the country’s liberalized mining law.

“Our country is blessed as one of the most highly mineralized countries in the world. It would be a disservice to our people if our full mineral potential is not realized as this is clearly a source of employment and development,’’ Press Secretary Ignacio Bunye said in a statement.
“A ban on mining is not the answer but the standards and safeguards already in place and existing laws must be strictly enforced. Mining remains a priority for development,’’ Bunye stressed.

Bunye issued the statement after the Malacañang-created Rapu-Rapu Fact-finding Commission submitted to President Macapagal-Arroyo on Friday a report recommending the scrapping of the environmental compliance certificate issued to the Australian Lafayette Group and calling for a moratorium on mining on the 5,000-ha island of Rapu-Rapu in Albay.

It also called for a review of the Mining Act, especially its provisions on foreign ownership and management of mining companies and operations.
The commission launched an inquiry following mine tailings spills on Rapu-Rapu.

Presidential adviser on political affairs Gabriel Claudio said in a radio interview that the commission might have overstepped its bounds when it recommended wholesale changes in the law.

“This is not a matter of whether the mining law should be amended or repealed. We will be guided by inputs from the members of Congress about this,” Claudio said. “I don’t think we should be hasty to have any conclusion on what legislative moves should be done.’’

Palace cancels presscon
The Mining Act had stirred controversy because it allowed for the first time foreign companies to have a stake in mineral exploration and production in the country.

The commission’s chair, Sorsogon Bishop Arturo Bastes, was to have held a press conference in Malacañang on Friday on his group’s recommendation but this was canceled at the last minute because Palace officials did not agree with its sweeping indictment of foreign mining investments in the country.

Bastes, instead, held his press conference outside the Palace.
Bunye said Ms Arroyo thanked the commission for its work and that she assured the public that its recommendations would be “carefully reviewed and considered.”

Environmental groups have welcomed the fact-finding commission’s recommendations.

“We hope President Arroyo will listen to the clamor of the people of Albay and Sorsogon to… keep the mines in Rapu Rapu closed as the negative environmental, social and economic impacts on the communities far outweigh the alleged benefits,” Greenpeace toxics campaigner Beau Baconguis said.

Flagship project
She said it was clear from the start that the P1.4-billion Rapu-Rapu polymetallic project, once dubbed the flagship of the administration’s program to revive the mining industry, threatened marine life in nearby bodies of water.

She said the government should form a team of experts to ensure that Lafayette Philippines Inc. cleaned up and rehabilitated the mine site and the surrounding marine areas.

“Moving forward will be meaningless without exacting full accountability from Lafayette and erring government officials,” Banconguis said.

Loss of 1,000 jobs
Defend Patrimony, a network of anti-mining groups, said the government should not cave in to Lafayette’s warning that the closure of its project would result in the loss of $259 million in investments and about 1,000 jobs.

“The commission validates the concerns of the people that the LPI operation will do more harm than good to the environment… and people,” Defend Patrimony spokesperson Trixie Concepcion said.
She said the commission’s report validated the position of fisherfolk, church people, environmental groups, local government officials, local businessmen and scientists against mining operations.

No test run
“The only way to save and rehabilitate the environment and the people of Rapu-Rapu is to permanently close Lafayette and to enact a moratorium on mining in the island,” Concepcion said.

Environment Secretary Angelo Reyes has rejected Lafayette’s request for a test run of its gold processing plant, saying he would wait for the recommendation of the commission.

The Department of Environment and Natural Resources suspended the gold processing operation of Lafayette last year and fined the company P10.7 million for its alleged violation of the Clean Water Act.

The Catholic Bishops Conference of the Philippines, in a pastoral letter last January, called for the repeal of the Mining Act, saying that it “destroys life.” The bishops expressed concern over what they said was the threat posed by large-scale mining operations to the people’s livelihood and health and to the environment.

Huge nickel reserves
“Our experiences of environmental tragedies and incidents with the mining transnational corporations belie all assurances of sustainable and responsible mining that the Arroyo administration is claiming,” the bishops said.

Besides having gold, silver, copper and other minerals, the Philippines is believed to have 25 percent of the world’s known nickel reserves, according to industry experts.

Estimates as of 2004 put at $1 trillion the worth of the country’s mineral resources.

P57 billion revenues if …
Local mining industry officials have said that the revitalization of the industry, which had been in decline for the past 20 years, could yield about P57 billion in additional revenues for the government.“The Philippines can be one of the richest countries in the region if only it can get its act together and harness its mining potential,” Leo Gamolo, general manager of mining firm Crew Group Philippines, wrote in the Inquirer last February.

Saturday, May 20, 2006

Probe urges revocation Lafayette permit

Mining probe body urges Lafayette license revoked
By Christian V. Esguerra, Christine Gaylican
Philippine Daily Inquirer May 20, 2006
http://news.inq7.net/archive_article/index.php?ver=0&index=1&story_id=76408

SAYING it wanted to send a strong message to investors that the Philippines was “not a nation of prostitutes,” a Malacañang-formed commission yesterday urged the government to review a mining law that allows foreigners 100 percent ownership of local mines, and to stop the operations of Australia’s Lafayette Mining Ltd. on Rapu-Rapu island, Albay.

The Rapu-Rapu fact-finding commission headed by Sorsogon Bishop Arturo Bastes called on the government to cancel the environmental compliance certificate issued to two companies of the Lafayette Group, and for a moratorium on mining on the island.

It also asked the government to “review the Philippine mining act, specifically the provision on the ownership and management of mining firms and operations,” Reuters news agency said, quoting from what it said was an advance copy of the report.

Over-reaction
Lafayette company president and chief executive officer Carlos Dominguez said the panel’s recommendation was an “over-reaction” to the environment incidents on Rapu-Rapu.

“With respect to their findings, it is in my belief that it has been exceedingly harsh and unforgiving considering that the incidents have been minor,” Dominguez told the Inquirer.

Dominguez asked what would happen to the 1,000 employees of the mines and to the economic benefits for the local community on the island if the Department of Environment and Natural Resources followed the commission’s recommendation.

“We hope the DENR would also consider the opinion of the Sangguniang Barangay, the municipal and provincial governments there,” he added.
Dissenting view

Commission vice chair Charles Avila said in a press conference: “This country is not a nation of prostitutes—that’s the message that we want to get to investors.”

“The mining industry is very promising if we do it properly by not sacrificing the environment and the people’s health.”

One of the nine members of the commission refused to sign the 169-page final report, saying he disagreed with some of its conclusions.
“I am unable to affix my signature to the final report of the commission as I disagree with a number of its findings and recommendations,” commissioner Gregorio Tabuena wrote Bastes. “I also feel that the commission has gone beyond its mandate.”

Mining output
In its report, the commission asked the Bureau of Internal Revenue to investigate the Lafayette Group “for underreporting of ore/processed ore production and violations of tax laws.”

It asked the government to order the company to “pay back all back taxes equivalent to those waived because of incentives/privileges for the whole duration of their mining operations.”

The commission found supposed discrepancies between the amount of gold ore the Rapu-Rapu Minerals Inc. (RRMI) reported to the DENR’s Mines and Geosciences Bureau Region 5 (67,693 metric tons) and the amount the company reported to the commission (136,180 metric tons).

Lafayette’s side
“The excise tax paid by the RRMI is probably only half of what it ought to pay the national government,” the commission said.

The commission also noted an alleged forgery of a town council’s signature in a resolution endorsing Rapu-Rapu as an ecozone.
Answering the commission’s claim about discrepancies in the firm’s gold ore reports, RRMI’s legal counsel Bayani Agabin said what the company reported to the MGB was “consistent” with what it reported to the commission.

On the alleged tax deficiencies, Agabin said the “wrong formula” must have been used in computing the amount of gold ore that had been mined.

Present proof
Agabin said the firm was aware of allegations about forgery in the ecozone certification resolution “but that is an allegation that has yet to be proven.”

“You cannot simply cancel a permit based on a simple allegation. That is why we have the courts,” Agabin said. “Somebody accuses someone of rape. That is just an accusation. You still have to go to court to prove it.”

He said the company had admitted there had been lapses in operations “but these were minor and all the remedial measures had been completed.”

DENR scored
Mining operations on Rapu-Rapu drew headlines following two tailings spills in October last year which reportedly led to fishkills and affected the fishing industry.

“The discharged tailings and effluents do not only carry cyanide but other toxic heavy metals as shown in subsequent studies made,” the commission said.

The commission scored the DENR for allowing the company to resume operations six days after the first incident.

“Lafayette had no emergency mechanism to stop or mitigate this kind of incident,” it said.

The commission said: “It was also negligent of the MGB officials who were coincidentally in the area on the day of the tailings incident and who conducted an on-the-spot investigation when they failed to impose immediate remediation measures on the mining company.”

Reyes will have last say
Dominguez said Lafayette would immediately meet with the Pollution Abjudication Board and show proof that the company should be allowed a test run.

“The burden of deciding whether we should be allowed to run will solely rest on (Environment) Secretary (Angelo) Reyes,” he said.

He said that the company had paid dearly enough when it was fined more than P10 million and that more than P400 million had been spent to put up necessary remedial measures in the area to prevent any environmental disasters in the future.

The mine is the first in the Philippines to be developed by a foreign company in almost four decades and has so far yielded 2,500 ounces of gold.

The Chamber of Mines of the Philippines said it believed that the government would be fair and consider the best scenario for the Rapu-Rapu Polymetallic Mines of Lafayette.

Respect findings but ...
“We respect their findings but it is just one opinion. We have presented a separate independent study that the DENR and Malacañang should also consider in making their final verdict for the Rapu-Rapu project,” Chamber of Mines president Benjamin Philip G. Romualdez said.He noted that the Bastes report did not tackle any issue on ownership and the industry had remained steadfast in its stand that any review that would strengthen the Philippine Mining Law was a welcome development for the industry.

Tuesday, May 09, 2006

Mining museum for Baguio centennial

Mining museum to rise for Baguio centennial
By Vincent Cabreza
Philippine Daily Inquirer May 09, 2006
http://news.inq7.net/archive_article/index.php?ver=0&index=1&story_id=75183

BAGUIO CITY--Philippine Ambassador to Germany Delia Albert is linking Baguio’s centennial celebration in 2009 to the mining industry by constructing a museum that would call attention to the country’s oldest mines that surround the city.

Citing the writings of the late diplomat and educator Salvador P. Lopez, Baguio-born Albert said American-led mining operations helped nurture what was once the “vast wilderness” of Benguet province into a “bustling metropolis.”

She announced the formation of the Baguio Historical and Mining Museum Foundation to alumni of the Baguio City National High School during their homecoming on Saturday at the Baguio Country Club.

The museum will rise here in two years, in time for Baguio’s celebration as a chartered city, Albert said. “I just received [the clearance from] the Securities and Exchange Commission last week.”

The museum will house relics showing the growth of old American mines on the city outskirts and focusing on the history of firms like Benguet Corp., the oldest recorded Philippine mining firm, as well as obscure and defunct operations like Demonstration Mine, which ceased when Japanese forces invaded the city in 1942.

Diplomatic frontier
A former Philippine foreign secretary and Malacañang’s envoy for mining, Albert noted that diplomacy had become mining’s new frontier because of the need to disclose to the global industry the Supreme Court decision that declared constitutional the 1995 Philippine Mining Act.

Mining has remained the single biggest industry which the government expects would turn the tide for many poverty-stricken regions like the Cordillera, she said.

Albert said it took her seven years as ambassador to Australia to win a trade deal allowing Canberra to buy Philippine mangoes.

There will be cynics, Albert acknowledged, saying that much of the anti-mining sentiments plaguing the industry today came from the old mining towns in Benguet.

Baguio seal
The city’s original seal bears out its connection to mining, she said. “The first Baguio seal is crossed diagonally by four golden dots that stand for the mineral wealth of Baguio’s four major mining communities.”
“Who in Baguio [does] not remember Antamok (where the oldest Philippine mining firm Benguet Corp. used to operate in Itogon town) or Lepanto (Consolidated Mining Corp. which operates in Mankayan town)?” she said.

She asked the BCNHS alumni to provide data and resources to “flesh out Baguio’s connection to the gold that has drawn Europeans to the city since the 1890s.”

Mining flourished under the American colonial government in the 1920s which designed and chartered Baguio as its only hill station in Asia, Albert said.

Ibaloi accounts
Even historical accounts from the indigenous Ibaloi community confirm mining’s role in expanding Baguio.

Eufronio Pungayao, a linguist and an Ibaloi historian, said the city’s economy started with Chinese trading houses that supplied food to American miners and their workers.

“In fact, the [city] population grew due to the attraction of mining,” said Joseph Jude Carantes, an Ibaloi clan leader and advocate for ancestral land rights.

Albert said national officials, like Senator Juan Flavier, were products of Baguio’s old mining culture. Flavier grew up in Itogon.

But some Baguio residents want “the whole truth about mining” to come out in Albert’s museum.

Centennial activities
Loreto Ann Tamayo, an environmentalist, said the facility should provide details on how old-school mining ended up despoiling Benguet lands.
Albert’s initiative is one of many independent projects geared toward highlighting Baguio’s 100 years of existence.

Mayor Braulio Yaranon has formed a core group of old-timers who will prepare for the centennial celebration.

Many of them, like Joseph Alabanza, former presidential adviser on urban reform, and Virginia de Guia, a former Baguio mayor, have been pushing for the restoration and preservation of the city’s remaining open lands as part of the centennial advocacy.

Alabanza, also a city architect, has been at the forefront of an architectural preservation program here, while De Guia is spearheading a crusade to stop the construction of a flyover in the city.