President's Corner

PMDC:  MINING AND ITS CURRENT DEVELOPMENT
(Delivered during the KAPIHAN SA PIA at the PIA Regional Office Davao on 15 January 2018)

By: Atty. Alberto B. Sipaco, Jr.
Chairman/President and Chief Executive Officer
Philippine Mining Development Corporation (PMDC)

INTRODUCTION

In recent months, the Philippine Mining Development Corporation (PMDC) has been working double-time to make its presence felt in the gold-rush area of Diwalwal, which is in Mt. Diwata, in the town of Monkayo, Compostela Valley Province.

Since the Duterte administration took over PMDC and changes have been adopted, the development of the 8,100-hectare Diwalwal Mineral Reservation Area (DMRA) has been hastened, although at times we are affected by the usual delays in completing certain processes necessary in making an instrument, document, or agreement effective.

Only recently, the PMDC signed an agreement with the Philippine Economic Zone Authority (PEZA) to convert the DMRA into a mineral processing industry zone. This development means sharing the responsibility of the PMDC with PEZA in the invitation of investors to develop the reservation area.

Beyond this new alliance, however, the focus of exploiting and developing the gold-rush area is still the major obligation of the government, and this responsibility encompasses many engagements crucial to the protection of many stakeholders, particularly settlers affected by the transfer of existing processing plants, resettlement of squatters, and the delivery of basic services to affected families.

DISCUSSION

The current policy direction of the Philippine government in mining has been divided clearly into two aspects. First, it is about RESPONSIBLE MINING, which is largely the campaign to follow legal guidelines, adopt ethically correct practices, and infuse a sense of moral obligation in the exploration, exploitation, and development of mineral resources.

The second aspect is what we call SUSTAINABLE DEVELOPMENT, which is anchored on certain precepts and concepts, mostly global in orientation. This puts into consideration concerns and issues on social corporate responsibility, benefits for host communities, revenues for the government, and post-mining opportunities, to name just a few.

Especially in relation to the DMRA, which is under the PMDC’s management, the significance of these two aspects goes beyond the traditional impressions we carry about how to mine responsible and how to develop the gold rush so as to last for another generation.

Today, the PMDC initiatives are directed towards maximizing the potentials of the major ore veins in the DMRA which, for decades, have not been subjected to efficient and effective industrial recovery of mineral resources. Though there were so-called ‘big-time’ miners who benefited from the gold-rush, the impact of their mining practices has resulted in numerous environmental complications.

For instance, after completing the feasibility study on the DMRA ore veins, PMDC plans, with the help of private investors, to make a cross-cut that will eventually connect the Victory Tunnel, acquired by the government from a private firm, to the Buena-Tinago vein. That development, if finally accomplished, would be one of the major source of gold minerals.

It is best that we define first what is RESPONSIBLE and what is SUSTAINABLE.

 

RESPONSIBLE MINING
SUSTAINABLE DEVELOPMENT
RESPONSIBILITY, broadly speaking, involves issues on accountability; being in control, has authority over, or in charge; dependability in doing only the best; maturity and sensibility; and, more important, trustworthiness when it comes adopting what the laws demand or what the duly constituted authorities require under a legit regime.In which case, RESPONSIBLE MINING points to the conscientious exploitation and use of mineral resources with an intention to embrace legal, right, ethical, moral, economically, and socially acceptable practices. SUSTAINABLE, in general, refers to acts that maintain the productivity of a venture; assurance the development of an initiative does not end without support; acts adopted or introduced are just and fair; there is workable mechanism that’s viable and, by extension, protect the environment and ecology without threat to stakeholders involved.
Therefore, SUSTAINABLE DEVELOPMENT is ensuring the productivity of the mineral hub is not sacrificed where the interest and safety of nature and its people-dependents are more important than gains.

 

PMDC-PEZA alliance

 Entering into an alliance with another government agency or a private entity is an important aspect of efficient management. If the PMDC areas, mainly the DMRA, will become mineral processing industry zones, investors can now put up mineral processing plants.

The central theme of the evolving events is to reecho the call of President Rodrigo Duterte to stop illegal mining and smuggling of raw minerals. Under an economic zone structure, the raw minerals are processed locally into high-value products for markets abroad.

In general, creating linkages in capital investments opens the floodgates to more breaks, such as the industrialization of the gold rush, establishment of settlements in safe areas near the mining areas, founding of housing projects, building infrastructures for mineral processing, and creating revenue and tax opportunities both for the state and the investors.

As it is now, there are existing developments in Diwalwal due to decades of exploitations, big and small. These initiatives are publicly known to us, and it’s only a matter of time when adjustments can be introduced in line with the aspiration of government to maximize the potentials of state assets, especially in areas known for their rich mineral resources.

And let it not be forgotten that PMDC’s mission includes the development of hosting communities, ensuring better reach of corporate social responsibility, extending royalties to the indigenous peoples, protecting key watersheds and reservoirs from destruction, desilting riverways affected by destructive mining, and bring to public coffers the funds needed to built infrastructures.

Today’s sharing will bring to light other details on how best is the government working on alternatives to address the issues in the DMRA, and from your end the perception on how the public at large is viewing these initiatives of the State.

Good morning to all.

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LAUNCHING OF ENVIRONMENTAL STEWARDSHIP PROGRAM
Monkayo, Compostela Valley Province, 26 January 2018

By: Atty. Alberto B. Sipaco, Jr.
Chairman, President and Chief Executive Officer
Philippine Mining Development Corporation

 

Ladies and gentlemen, good day to everyone…

Have you ever pondered for a minute and ask what an Environment is all about? In more ways than one, it refers to the nature surrounding us. But the import of environment goes beyond what we directly sense, which is “the surroundings or conditions in which a person, animal, or plant lives or operates.” In fact, environment is, “the natural world, as a whole or in a particular geographical area, especially as affected by human activity.”

Today’s activity is about launching an environmental stewardship program which, collectively, introduces an undertaking that chiefly focuses in protecting nature from any form of human devastation. When we say ‘stewardship,’ it is not just about the privilege to look after the welfare of forests, watersheds, and other natural attributes that affect our daily lives. More extensively, it is the responsibility of supervising and taking care of an activity, asset, and all those that define our relationship with nature.

Especially in Monkayo where the threat of ruin has become more apparent with the calamities it has experienced in the last 100 years, stewardship means taking on the multiple challenges such as landslides, floods, deforestation, mining spills, cave-ins, and weather disturbances.

Behind the stewardship program we launch today is the resolve to be aware of our obligation and duty towards the environment that has provided us the tools to live, and the responsibility to translate our experiences into concrete channels for more viable and feasible undertakings.

I, for one, understand the rigors that come with taking on a job that’s as daring as protecting nature. But we must be proactive in pursuing initiatives that secure our families and assets from destruction. We alone have the mentality and the tools to become true stewards of nature. With that in mind, we must take the test with optimism, resolve, and commitment.

To all those who believe in environmental stewardship, we must be united in our desire and effort to bring back nature’s productive influence in our lives, especially when it comes to food and livelihood. It’s a tough goal but we can do it. Daghang salamat ug maayong buntag sa tanan.

 

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ARENA “SERBISYO CARAVAN”
(Delivered during the 2ND day of Serbisyo Caravan Program, Brgy. Upper Ulip, Monkayo, Compostela Valley Province, on 04 October 2017)

By Atty. Alberto B. Sipaco, Jr.
Chairman, President and Chief Executive Officer Philippine Mining Development Corporation

Ladies and gentlemen, good afternoon…

Holding an ARENA activity in a far-flung village may sound unique but this is not the first time that the regional executives have left the comfort of their swivel chairs and visit communities sometimes we refer to as “pinag-iwanan ng panahon”.

This ARENA visit holds greater meaning because Upper Ulip is not just part of the golden bowl we call Diwalwal; it is also a region that is overlooked because people tend to focus more on what Mt. Diwata can offer than what can be shared to the residents in this barangay.

This area is a contrast between abundant resource and poverty; and between frugal living and expensive commodities. Despite the billions of pesos in transactions that have been materialized in the Mt. Diwata gold rush, Upper Ulip remains a region struggling to become progressive.

ARENA’s SERBISYO CARAVAN is more than just a regional undertaking; it is; in fact, a national project conceived to help needy communities, an inter-agency initiative that’s in line with President Rodrigo Duterte’s advocacy to bring the government closer to areas mired in poverty.

Because of its unique composition, Serbisyo Caravan has become a collective effort of numerous regional offices with a mission to know firsthand the true and unbiased needs of Filipinos in remote places.,

For us at the Philippine Mining Development Corporation, this ARENA visit fittingly comes at a time when our focus is on salvaging what can be saved from the depleted resources of Mt. Diwalwal. In particular, PMDC is putting on the break against wanton destruction of forest and the rape of the environment.<

What is PMDC? The Philippine Mining Development Corporation is a government-owned and controlled corporation. ü It is non-chartered and does not receive any budget from the National Government/General Appropriations Act. ü It has a Governing Board presided by PMDC Chairman ü It has a Governing Board composed of 1. Secretary – Dept. of Environment and Natural Resources 2. Secretary – Dept. of Finance 3. Secretary – Dept. of Energy 4. President – Development Bank of the Philippines 5. President – Phil. National Oil Corporation 6. President – The National Development Company 7. Four (4) Members from the Private Sectors appointed by the President of the Philippines

History When Presidential Proclamation was issued by then President Gloria Macapagal Arroyo in 2003 delineating 8,100 hectares of mineralized land as Diwalwal Mineral Reservation Area (DMRA) it created and established thereby, a corporate entity, the Natural Resources Mining and Development Corporation (NRMDC) later and now known as the Philippine Mining Development Corporation (PMDC) to exercise jurisdiction and complete control over the said area to monitor and implement the Philippine Mining Laws.

Mandate The PMDC has the following mandates: To explore, develop, mine, smelt, and produce, transport, store, distribute, exchange, sell, dispose, import, export, trade and promote gold, silver, copper, iron, and all kinds of mineral deposits and substances.

Alongside this thrust to make the gold-rush area productive once again in terms of revenues and taxes to the government, PMDC is also determined to develop Upper Ulip into a village of peace with sustainable resources that provide livelihood and income to barangay residents. We also want to make the people of this community not just the guardians of ecosystem but the beneficiary of the wealth that belong to them and the State.

With the ARENA’s manpower and financial resources, let it be an inspiration to the people of Upper Ulip that our common efforts to secure nature from destruction and to benefit from the mineral sources is a commitment that is continuing. More than anything else, we need each other’s support in getting to where we know there is fulfillment of our ambitions.

To the ARENA members, it is elating to know that you share what the Duterte leadership has in its agenda in helping the poor communities. Your united front and our commitment pursuit to improve the lives of communities hosting mineral resources belonging to the State are essential in achieving growth, development, and sufficiency for everyone.

Finally, let me leave the message that the success of a government project does not solely rely on those who work in the bureaucracy. The most important aspect of achieving triumph in governance starts with the willingness and enthusiasm on those for whom public services are conveyed or extended.

Daghang Salamat.

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The Government Thrusts & Direction for the Mining Industry
(Delivered during the ‘Forum on Responsible Mining held at the Social Hall, University of Southeastern
Philippines, Davao City, on 06 September 2017)

By Atty. Alberto B. Sipaco, Jr.
Chairman, President and Chief Executive Officer
Philippine Mining Development Corporation

 

Ladies and gentlemen, good afternoon…

For over three decades, the mining industry has only been treated in passing as a story not worth the national headlines. During this period, in the mountains of Diwalwal and elsewhere in the archipelago, the exploitation of mineral resources, the destruction of forests, the unabated dumping of pollutants in waterways, and the wanton damage to ecological watersheds were considered free-wheeling.

Worse, the solidifying of the culture of corruption in most mining sites in terms of gold smuggling, non-payment of taxes, theft of minerals, and protection of illegal miners by state personnel were without contrast.

For so long, this was the state of the mining industry: in disarray, without control, out of bounds, free for all, or what have you. In short, the mining industry had its foulest history since the end of the war.

It was only last year that the audit of mining firms took a high-profile twist. For the first time, the noise being raised in public against mining malpractices, especially those that ruin the environment and ravage the ecological watersheds, was strongest.

Even President Rodrigo Duterte, already firm in his warnings against violators in the sector, had to issue blunt warnings in delivering his message of disgust to wealthy miners who have short-changed the government. The message was clear, and it was about responsible mining.

Over the past year under the Duterte leadership, a decade of, or ten, events have transpired, directly or otherwise, that will reshape and, hopefully, strengthen the productivity of mining sector in months to come.

While some of these are not strictly government thrusts and directions, the following developments converge at a point where the industry, first and foremost, can be forced to account itself for the abuses committed in the past and, by extension, to adopt stricter policies that point to engagements that address (i) the environment, (ii) taxes, and (ii) the welfare of host communities.

First, the persistent abuses committed by some blue-chip mining industry players has compelled the President to adopt drastic moves, including closure, tax audit, and filing of charges, against companies involved in the ruin of forests or the environment in general. Obviously, the impact of destructive mining in relation to calamities is something that has displaced people, drained state resources, damaged public works, and cost lives.

Second, there is a coordinated move to seek public position on the status of openpit mining which has been singularly blamed for the deforestation of thousands of mountainous regions that were once green vegetation. The media documentaries, ocular inspections, state mining audits, and non-government studies have collectively shown this as damaging as far as environment and the livelihood of people near the mining site are concerned.

Third, there is a current initiative in Congress to revisit the mining laws and make amendments on them. While the issue of open-pit mining is part of that intention, the other serious subject being tabled for discussion is the opening of the industry to 100% foreign ownership but with more stringent regulations to boot. With alien
investors possessing more wealth for mining, there’s a strong possibility this idea will eventually get support.

Fourth, without the public really knowing it, the government is conducting an honest to goodness audit and inventory of its mining assets. At the Philippine Mining Development Corporation, we are reappraising the leases issued in the past, especially those that are nearing expiry, and introduce new adjustments in conditions. In line with our corporate mission, we want the word ‘responsible’ taken seriously by private stakeholders.

Fifth, the legislature is also pushing for the franchising of mining in the country, a move that’s oddly difficult to subsume given that the function to oversee mining falls under the Executive, which also has the wherewithal and expertise to manage the industry. A big sector of mining has ambivalent perceptions on the measure, saying the true intention behind this undertaking can only result in corruption and lobbying.

Sixth, the organizational glitch affecting the Chamber of Mines, which resulted in the resignation of one of its major stakeholders, underscores the need for the group to re-evaluate its thrusts. The resignation came as a result of the chamber’s statement that small-time miners must be blamed for the destruction of the environment even if in truth the big miners themselves are also to be blamed for destroying the ecological watersheds.

Seventh, the serious issue of protecting forests and environment against predators was again highlighted with the shooting of forester Joselito Eyala in Palawan. He was not only given the highest citation by DENR Secretary Roy Cimatu for his dedication to public service, bravery and leadership, he was also honoured with the Medalya ng Bayani ng Kalikasan and a Purple Heart, which is usually given to soldiers wounded in battle.

Eighth, the government audit of private mining firms that were issued permits to operate under a mineral production sharing agreement (MPSA) is on high on the list. The matter is complicated because it involves other major mining concerns, namely: (i) the subleasing of the agreement, (ii) the lack of capital of MPSA holder, and (iii) the illegal exploration and exploitation of mineral resources using the same instrument as passport.

Ninth, the President has taken an iron-clad position on companies and their stakeholders to undergo audit by the BIR so as to assess if the proper taxes and revenues accruing to government have been paid. There’s nothing new in this intention but obviously the government has observed some deficiencies and lapses that need urgent adjustments and corrections.

And, tenth, the government has slowly shifted its policy of exporting minerals to processing them into exportable articles or merchandise. Given the rising demand for high-end jewelry and electronic parts, the Philippine Export Processing Zone (PEZA) has encouraged the entry of investors engaged in personal ornaments and, with incentives as come-on, infuse new vibrancy into creating a lucrative jewelry industry in the country.

But beyond these evolving issues, there are more noteworthy concerns that are also getting the most thoughtful attention among technocrats, and these are all pursued in the name of responsible mining.

For instance, instead of talking about the possible taxes that can be derived from the industry, the government is bent on strengthening the entry of players in the mining sector. That would mean addressing first the red flags that have been observed , most of them laced with political disturbances, and introduce new guidelines and regulations.

Experts are also one in mind that pre-emptive measures, more than corrective mechanisms placed along the way, will reasonably address knotty issues that come after an investment company has complied with all the papers and documents for its mining operations.

The complexities that come with litigation, investigation, filing of motions for reconsideration, and other legal nuances always end up with cases resolved just as the lifespan of mining company is coming to a close.

Adopting pre-emptive or pro-active checks require comprehensive but rational appreciation of the mechanisms that are at work when a mining company is finally allowed to go on full-blast operations. These checks, or safety nets, may include periodic appraisal of mining performances in relation to environmental obligations and the wellbeing of host communities.

The thrust of slowly transforming the mineral industry into an export-oriented component is also a serious focus. For one thing, such move, including the development of the local jewelry industry, will generate jobs, livelihoods, and opportunities that cannot be created if metallic ores and minerals are shipped abroad as raw materials.

Conversely, processing of minerals for export is helpful in terms of dollar savings and better income for local investors. Of course, in pursuing these goals, the active role the government has to play will be indispensable in achieving the objectives of making the mining industry more vibrant, productive, interactive, and community responsive.

Another often overlooked issue that must also be addressed with urgency is to include the local government units in the interplay in the mining sector, such that any income derived from it will also directly benefit the host communities and the LGU that has jurisdiction over the mining areas.

Of course, there is much to be done yet in really making the mining industry more attractive to investors. As it is now, the government is shifting its initiatives to priorities that have huge impact in the way the industry will be operated, particularly in acting out its role as a major revenue player in the government’s financial direction. We can only hope for the best that this optimism will find fulfilment during the Duterte leadership.

Daghang salamat ug maayong hapon sa tanan.

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Organizational Meeting on the Launching of the National Advocacy for Responsible Mining

June 22, 2017, DBP Building, Makati City

 

Today’s organizational meeting on the launching of the National Advocacy for Responsible Mining has provided us with a larger than usual view on the urgency to make mining both sustainable and responsible.

The impressions, observations, and perspectives shared are not entirely newly conceived dimensions; rather, they reflect the soundness of our appreciation on the need to protect the industry in ways that do not destroy nature but also shield the communities that host it.

The role the host communities play in responsibly sheltering the country’s mineral resources from overexploitation is an imperative that should echo the valid sentiments of the government towards mining companies, which is to share the wealth of the earth to those who have become their partners in exploiting the underground wealth.

The challenge to make responsible mining a true and factual phenomenon in the mining industry starts with our credible response to the call of protecting the environment, and accepting the responsibility of taking that mission to where it should be.

We know for a fact the rules of the game in the mining industry can change as a result of political adjustments. Nonetheless, we must also ensure that the next generations’ rights to inherit the wealth of the earth are secured and not violated.

The benchmark of responsible mining is not just our willingness to embrace the advocacy we have just launched but it also involves the conduct of initiatives that reflect the intent and wisdom of our laws in exploiting the country’s natural wealth.

To be responsible is to be sustainable, and to be sustainable is to embrace policies that reflect the best practices in the industry.

There’s no arguing that any government always looks forward to earning its due from industries in order to fund its pro-people undertakings. But if the taxes and revenues it amasses come from spurious sources and dubious practices, the issue of responsibility is ruined.

Reiterating the vision-mission of the Philippine Mineral Development Corporation (PMDC), the mining industry must endeavour, to the satisfaction of the public, in pursuing vital goals, such as adopting best practices, the pursuit of truthful corporate social responsibility, extending socio-economic benefits to host communities, paying correct taxes to the State, and earning reasonable profits from the exploitation of mineral resources.

To say that we have achieved something realistic today is an understatement.  In fact, the presence of numerous stakeholders that define the socio-economic and political landscape of the mining industry is a reminder that in the future a broader consultation of this kind will be to the advantage of the people committed to make the industry accountable, workable, and cost-effective.

To all of those who have to share their thoughts, Thank you very much!

 

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Foundational Course on Mining Business and Human Rights – Trainors’ Training

June 08, 2017 ; SEDA Abreeza Hotel Davao

 

Ladies and gentlemen, good morning…

At a time when the norms of a modern world are enhanced to fit the demands of the times, the imperatives and the interventions required to address specific issues have also appreciated and updated. One thing indisputably remains constant, though: The new standards before us today are intertwined, inseparable and significant parts of each other.

Today’s trainors training affords us a new window into the links there are between mining as a business and the rights of stakeholders as viewed from a humanitarian perspective. This connection has not been fully explored in the mining industry largely because the problems that have been identified are far removed from the solutions necessary to address them.

In forums and symposiums, the mining industry has been discussed purely as a business endeavor. People in the know talk about capital, profits, foreign exchange, and returns of investment. In recent decades, issues on environment, Climate Change, and disaster risk reduction have entered our vocabulary, and the sound bites that have been generated by these compelling themes are stronger than ever.

Lost in the din of so many mining concerns is the issue of human rights which the United Nations has long pursued with vigor, and pushed with intensity. This is a central subject that this training, which is aptly titled as the ‘Foundational Course on Mining Business and Human Rights’, focuses on.

Embodied in the three-day training are ten modules that bring to our consciousness approaches, distilled from years of studies, that answer our queries on how to deal with human rights in the context of addressing the knotty issues affecting the mining industry.

Central to the exercise is the highlight on the role of human rights, the civil society, and the national action plan in mitigating the impact of emotional issues that have not been properly addressed by those who play key roles in the growth of mining as an industry.

To all those around who have set aside time to become part of this engagement, welcome to the event and welcome to the new dimension of mining and human rights. Again, maayong buntag sa tanan.

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