Thursday, April 13, 2017

BWorld 122, Six more myths in the mining debate

* This is my article in BusinessWorld last March 29, 2017.

A piece that I wrote for this space, “Seven myths in the mining debate” (March 15), has attracted attention from many readers, expressing either support or disagreement. One even sent an angry comment via e-mail. So I will add additional myths in the continuing debate on the issue.

To review, here are the seven myths discussed in the earlier article:

1. Mining contributes small, only P70 billion a year in gross value added (GVA).
2. Mining tax payment is small at only P3 billion a year.
3. Employment share of mining is very small at only around 100,000 workers.
4. Very small benefits, better stop all mining activities.
5. Open pit mining must be banned anywhere.
6. Closure of many mining firms means better investment environment.
7. Mining is entirely useless, we should have none of it.


1 Large-scale mining covers a huge area of the Philippines.

Wrong. Only 2.3% of the Philippines’ total land area is covered by mining permits composed of 319 Mineral Production Sharing Agreement (MPSA) and five Financial or Technical Assistance Agreement (FTAA). Of this figure, only 0.27% of land area is actively mined, the rest are for roads, offices, houses, hospitals, schools, other community projects; mined out and rehabilitated areas, or for future mining. (See table.) 

What made the impression of “huge mining areas” include those under small scale mines (SSM) like in Mt. Diwalwal.

2 Large-scale mining is the biggest cause of soil erosion.

Wrong. Very often, it is deforestation or conversion of forest land into pasture land, agriculture land, or simply the endless cutting of trees in public forests.

The DENR is not exactly known to efficiently address these problems because it prefers to take more political noise in mining.

3 More mining areas result in more poverty.

Generally wrong. The top 20 poorest provinces in the Philippines and their poverty incidence are: (1) Tawi-Tawi 78.9%, (2) Zamboanga Del Norte 63.0%, (3) Maguindanao 62.0%, (4) Apayao 57.5%, (5) Surigao Del Norte 53.2%, (6) Lanao Del Sur 52.5%, (7) Northern Samar 52.2%, (8) Masbate 51.0%, (9) Abra 50.1%, and (10) Misamis Occidental 48.8%.

(11) Agusan Del Sur 48.7%, (12) Oriental Mindoro 47.1%, (13) Sulu 46.5%, (13) Occidental Mindoro 46.5%, (15) Kalinga 45.8%, (16) Surigao Del Sur 45.4%, (17) Mountain Province 45.0%, (18) Sarangani 44.8%, (19) Lanao Del Norte 44.1%, and (20) Negros Oriental 43.7%. (Source: NEDA, Philippine Development Plan 2017-2022).

Of these, only five host big mining companies (with an area of at least 4,000 hectares): Zamboanga del Norte (2 firms), Surigao del Norte (5 firms), Surigao del Sur (3 firms), and Mindoro Occidental and Oriental (2 firms).

These 21 provinces hosting big mining companies (at least 4,000 hectares) are not in the Top 20 poorest:, Zamboanga del Sur (Siennalyn Gold, TVI, 168 Ferum, Vilor), Sultan Kudarat (GRCO Isulan), Agusan del Norte (Agata), Davao Oriental (Hallmark, Austral-Asia Link, Dabawenyo Minerals, Sinophil, Oro East), Dinagat Islands (East Coast), Compostela Valley (Napnapan), Sarangani (Hard Rock).

Capiz and Iloilo (Teresa Marble, Parvis Gold,), Samar (Alumina, Bauxite), Leyte (Explosive Consult., Fastem Construction, Strong Built), Palawan (C. Palawan, Palawan Star, Pyramid Hill, Narra Nickel), Quezon and Camarines Sur (VIL Mines), Benguet (Philex), Zambales (Mina Tierra, Eramen), Cagayan (Peniel, JVDC, T&T, J&M), Nueva Vizcaya and Quirino (Oceana Gold), Ilocos Sur and Pangasinan (Altamina Exploration).

4 Mining can stop in the Philippines but continues in other countries.

Wrong. Mining is either good or bad; if bad then mining should stop worldwide, the same way that anti-coal campaigners want all coal power plants to close worldwide, not just in the Philippines. If mining is good abroad then the good practices should be adopted here. The law in post-Marcopper mining disaster in Marinduque, the Philippine Mining Act of 1995 has been hailed by many countries as the one of the world’s first stringent mining laws.

5 Open pit mines are destructive and not done in developed countries.

Wrong. Six of the 10 biggest and deepest open mines in the world are found in the US (Bingham Canyon, Hull-Rust-Mahoning), Canada (Diavik Diamond), Australia (Super Pit) and Russia (Mir Diamond Mine, Udachny Diamond). The other four are found in S. Africa (Kimberly Diamond), Indonesia (Grasberg Mine), and Chile (Chuquicamata Copper, Escondida Copper).

6 DENR Secretary’s closure of mining firms follows the rule of law.

Wrong. Secretary Gina Lopez has disregarded procedures and even the recommendations of her technical staff. As pointed out by Rep. Josephine Sato, “We are the legislature; if you’re not happy with the law tell us we will review and revise if necessary but you can’t legislate on your own...”

Mining practices that follow international and national regulations should continue and contribute to economic modernization and job creation. Those that violate these laws deserve suspension or closure.

See also: 

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