Minerals Management Bill

WHAT IS THE MINERALS MANAGEMENT BILL?

The Minerals Management Bill seeks to scrap the present Mining Act of 1995 (RA 7942) with the enactment of the “Philippine Mineral Resources Act of 2010”. The bill champions conservation of non-renewable mineral resources for the benefit of both present and future generations of Filipinos by adopting a sustainable, rational, needs based minerals management geared towards effective utilization of mineral resources for national industrialization and modernization of agriculture.

HOW DO WE LOOK AT MINERAL RESOURCES AND MINING?

Minerals are essential resources that are part of our national patrimony. While necessary for national development and important to the economy, the extraction of mineral resources must be done judiciously because mineral areas are part and parcel of ecosystems that includes forests, watersheds, riverine systems, coastal habitats and communities of people – all of which are intrinsically linked with biodiversity, the environment, food security, livelihoods and survival. Specially now in the era of undeniable climate change, it is our responsibility to make sure that minerals governance do not sabotage efforts to mitigate the impact of climate change as well as our capability to move towards a low carbon global economy.

It should also be underscored that minerals are essentially non-renewable resources, we have an inter-generational responsibility towards its conservation and preservation – mineral extraction should only be done as a last resort out of the utmost necessity and with the least impact on communities and the environment.

WHAT IS WRONG WITH THE MINING ACT of 1995 (RA 7942)?

RA 7942 or the Mining Act of 1995 essentially caters to the need of the global extractives industry players to access mineral areas and control the use of minerals to feed the global corporate demand for raw materials and energy in the production, distribution and consumption of commodity products – a system wholly motivated by profits.

What the law does is facilitate the entry of corporations into ecosystems and community territories for the exploration and extraction of minerals to be shipped out of the country in exchange for revenues from the corporations. The government has not been shy in saying that the mining industry is essentially an elaborate investments baiting and revenue making scheme – or PLAK (pera lang ang katapat).

Even with this frank admission, it still is a big lie because with the overgenerous fiscal incentives regime of the Mining Act and other laws, the corporations only need to leave us with a few loose change in exchange for our mineral resources, leaving large scale and long term destruction to the environment and communities in their wake. In perpetuating this system, the Mining Act of 1995 has been used to sabotage local government efforts to protect the health, environment and livelihoods of their constituents; corrupted the Free, Prior and Informed Consent (FPIC) process of indigenous peoples communities; rendered inutile the Environmental Impact Assessment system; and has brought about a long string of human rights violations against communities and individuals resisting mining.

WHAT IS THE DAPITAN INITIATIVE of 2002?

The Minerals Management Bill has its origins in the 2002 conference of environmental, social and community rights advocates that has criticized the economic and political set-up of the mining industry and opposed the legal framework that propped it up. In their declaration, they committed themselves to “uphold indigenous people’s rights and achieve a more ecologically sound, gender-fair, equitable system of resource management.” and to “work for a democratic and consultative process in enacting a new legal framework to achieve a wise stewardship of our natural resources.”

After several years of consultations on the ground and meetings with experts, we were able to file the new bill in the last congress, HB 3763, which was also called the Alternative Mining Bill (AMB). We have decided to discontinue the use of the name “alternative mining bill” to avoid the confusion and misinterpretation this has caused. The bill is not about a new method of mining (“alternative mining”) nor is it focused or only about mineral extraction (“mining”). It is a bill on overall mineral resource management and governance (not just mining) that will replace the Mining Act of 1995 (it is an alternative bill to RA 7942, and not about alternative mining).

Our colleagues from the church sector had started to use the term “Natural Resources Management and Stewardship Bill”. For purposes brevity for this primer and to capture the essence of the bill, we are referring to it here as the “Minerals Management Bill”.

What are the important provisions of the Minerals Management Bill?

Conservation of our Mineral Resources Use of minerals must take into consideration the allocation needed to be used by future generations, remining and recycling of minerals will the prioritized, as well as the rehabilitation of old abandoned mines. If to be used by the present generation, it would only be under a rational needs based utilization and domestic use oriented framework, with actual mineral extraction further weighed against the ecological and social benefits and costs from other land uses.

For the Benefit of the Filipino People The exploration, development and utilization of mineral resources are primarily for the benefit of the Filipino people, it will be geared towards national industrialization and modernization of agriculture, towards this end the state shall build the domestic processing capacity for industrial metals and other labor-intensive downstream industries. Only mineral resources that shall be needed for local industries shall be mined.

Minerals Utilization Framework This will be formulated to support plans for national development based on the principles of sustainable development. This framework will define minerals to be extracted, volume to be extracted and when to be extracted. The Mines and Geosciences Bureau (MGB) will be transformed into a purely scientific research institution under the Department of Science and Technology (DOST), and exploration of strategic minerals shall be exclusively and directly undertaken by the State through the Bureau. The MGB shall come up with an inventory or mineral resources, identify strategic minerals needed for national development, demarcate mineral areas and build baseline information on watershed continuums.

Multisectoral Minerals Councils (MMC) Affected local communities and local government units will be those who will be potentially impacted by mining located in relation to a watershed continuum – an area consisting of a watershed and the interconnection from the headwater to the reef. A Multisectoral Mineral Council will be created in each watershed continuum area which will have the authority to allow extraction and processing of minerals in their area and approve mineral agreements.

Ownership of Indigenous Peoples Mineral resources within ancestral domains/ancestral lands are the collective private property of the indigenous cultural communities/indigenous peoples (ICCs/IPs). No mining activity shall be conducted within the ancestral domains/lands of ICCs/IPs without their free, prior and informed consent (FPIC).

No Go Zones There will be areas closed to mining operations which will include among others – critical watersheds, geo-hazard areas, small island ecosystems, lands covered by the Comprehensive Agrarian Reform Law, key biodiversity areas, etc. Furthermore, mineral extraction will not be allowed in areas more beneficial to other land use, priority will be given for more viable and more sustainable livelihood choices for communities, with utmost importance given to food security and livable conditions for  peoples;

Mineral Agreements Mineral resources development, utilization and processing shall be reserved for Filipino citizens and for Filipino corporations. Financial and Technical Assistance Agreements (FTAAS) and any other agreements granting foreign corporations to explore or extract mineral resources will not be allowed. The contract area per agreement shall not exceed five hundred (500) hectares and the maximum allowable total contract area for any person in any given watershed area will be seven hundred-fifty (750) hectares. The term for a mineral agreement will be the mine life plus five (5) years for rehabilitation, which in total should not exceed fifteen (15) years.

Maximizing Gains and Preventing or Mitigating Adverse Effects Corporate transparency and accountability will be established. At the onset, contractors shall submit their Environmental and Social Impact Prevention and Mitigation Plan (ESIPMP) which will also contain a Social Development Management Plan. Mandatory consultations with affected communities shall be undertaken in each phase of mining operation, and free prior and informed consent of indigenous peoples at each mining phase shall also be required. Human rights protection will be prioritized and penalties imposed for violations thereof .

Open-pit mining method for the extraction of mineral ores shall be prohibited.

Equitable Sharing Aside from fees and taxes, government shall have at least a share equivalent to ten per cent (10%) of the gross revenues from the development and utilization of mineral resources that are owned by it. In case of mineral operations within ancestral domains, the contractor shall pay at least ten per cent (10%) of the gross revenues as royalty to the ICCs/IPs. Community development programs shall not be considered as royalty payment.

PHILIPPINE MINERAL RESOURCES ACT of 2010

EXPLANATORY NOTE

The country’s natural resources form a great part of the nation’s wealth.  Consequently, all activities which have the propensity to impair the quality of our natural resources should be subjected to scrutiny before being allowed to continue.

One of the industries which have massive societal and environmental impacts is the mining industry. It is essentially an extractive industry which results in the depletion of nonrenewable resources.

However, despite the naturally polluting tendency of the mining industry, the Philippine government’s legislation and policies are largely pro-mining beginning with the passage of the Philippine Mining Act or Republic Act 7942 in 1995. It sought to liberalize the mining industry to foreign investment in order to meet the demands of globalization. The law was eventually declared unconstitutional by the Supreme Court in the leading case of La Bugal B’laan Tribal Association v. Ramos, a decision that was overturned less than a year later. The history of that case mirrors the proclivity of the government to act against its better judgment once the so-called profits of mining are brought into the picture. Indeed, the law has continued to serve as a platform for every administration’s determined pursuit of mining as its most lucrative attraction for foreign investors, especially the previous administration.  In executive issuances EO 270 and 270-A, the previous administration outlined a national policy agenda for the revitalization of the mining industry as a pillar of growth. It declared that the vast mineral resources of our country should be utilized for economic development and poverty alleviation, especially in the rural areas. It further fast-tracked the procedures for processing mining applications and diluted the authority of the local governments over mining issues.

Considering the history of serious mining accidents and the mining corporations’ poor record in complying with our inadequate mining laws, the government’s deference to the mining industry should be better examined. The baseless messianic view that the mining industry will attract foreign investment and save the country’s faltering economy should be pitted against the numerous controversies over the massive social, economic and environmental impacts of the mining industry. In particular, the easy access of mining companies into indigenous peoples lands and ancestral domains and the controversy over mining in watersheds and other protected areas must be studied thoroughly.

Furthermore, the devastating effects of mining on the health of the environment and communities on the long-term and at a large scale are both well-documented and unprecedented. Mining is an intrinsically dirty, wasteful and destructive industry – it threatens 40% of the world’s undeveloped forests, causes the emission of 142 million tons of acid-rain-causing sulphur dioxide each year, and consumes from seven to 10 percent of the world’s energy. The creation of one gold ring generates three tons of waste, mostly left behind in indigenous peoples’ domains where half of the world’s gold are mined.

In the Philippines, the Marcopper disaster in Marinduque is one of the most notorious examples dramatizing the Philippines’ own struggle with the hazards of mining. More than three million tons of toxic sludge were released into the Boac River in 1996 when a drainage tunnel burst, rendering the river biologically dead. This after two decades of environmental havoc had already been brought about by Placer Dome, the Canadian mining firm responsible for the Marcopper mines, which caused the dumping, via surface disposal, of more than 200 million tons of mine tailings directly into the shallow waters of Calancan Bay, covering corals and sea grasses and the bottom of the bay with 80 square kilometers of tailings.

Yet, despite these statistics and experiences, our policy-makers have championed mining as the virtual savior of our economy and made it a “pet project” of sorts, laboring under the illusion that it can still bring high revenues for the government. The reality, however, is that the mining industry is currently one of the weakest sectors in the global market. The big transnational mining companies have cut their workforces by the thousands and mining projects have been shelved with the global financial crisis which Karsten Fuelster, a mining division business development official for the International Finance Corp. have said is leading to “substantial short-term demand destruction.” He adds that prices for metals apart from gold are expected to fall and projects will get delayed and exploration curtailed, while “funding difficulties will get worse” before they get better and that fund-raising will become “nearly impossible for non-producing companies” and that “many will not survive.”

Even historically speaking, mining has never been shown to drive national economic development and is not expected to do so now, especially vis-à-vis the social, cultural, environmental, health, and even the economic costs it entails. In the Philippines, mineral-rich provinces continue to have higher poverty incidences despite the operations of mining companies. Instead, mining has exacerbated conflicts, resulted in the displacement of indigenous peoples and other rural communities, heightened the numbers of extra-judicial killings and of human rights violations, and caused and exacerbated the pollution and depletion of natural resources which for generations have sustained livelihoods and defined our people’s way of life. To pour resources into an industry which contributes only 1.2% of the country’s GDP, instead of, say, into the agricultural sector which accounts for 35.7% of the country’s labor force and economically contributes more to the country’s GDP at 18%[1] simply defies good common sense.

The promotion of mining, therefore, in this time of crisis will translate not only to bad investment but also to the waste of what little resources we have remaining, these resources referring to both money in the bank and to those that are most essential such as water and food. There is an obvious and urgent need to shift our present framework on mining. We need to rethink our current priorities and recognize that it not only impossible but also unwise to separate mining from the discussion of resource use, water, food security, environment, human rights, 1indigenous peoples and economics.

If there is truly a need for mining and if we are to engage in the mining industry as a nation, then there are certain safeguards that we need to establish to be able to meet the needs of our peoples now and in the future. There must be a shift of land use priorities towards sustainable development and food security. The benefits of mining for the Filipino peoples should clearly be established before even considering exposing our land and our people to the risks and hazards that are entailed.

Against this backdrop, the exploration of our mineral wealth must be understood within the context of environmental protection and sustainable development.  The policies of the State should be aimed at preventing disasters rather than mere remedial in nature. Since the effects of the mining industry are irreversible and the remedies or rehabilitation of the environment after disasters have occurred would be merely an exercise in futility, it would be better to formulate policies that will abate the occurrence of such deleterious events.

In this regard, the policies, principles and provisions contained in the 1995 Mining Act sorely lack what is needed to effectively respond to the needs of the Filipino people and to survive the current economic and environmental crises that we together face. This bill is therefore proposed to take the place of the current mining law and, among others:

– guarantee that the exploration, development and utilization of mineral resources are primarily for the benefit of the Filipino people;

– prioritize more viable and more sustainable livelihood choices for communities, giving utmost importance to food security and livable conditions for the peoples;

– ensure that the gains from the mining industry would be maximized while preventing or mitigating its adverse effects of the same;

– recognize that the issue of environment is local and prioritize local participation in decisions surrounding mining; and

– protect human rights of communities and individuals and impose harsh penalties for the violations thereof.