Nickel Initiative 2019 Highlights

by Marcelle P. Villegas - May 29, 2019

18 March 2019, Shangri-La at the Fort, Taguig City -- Ribbon-cutting ceremony of The Nickel Initiative 2019 Conference by Philippine Nickel Industry Association (PNIA) [Photo by: Marcelle P. Villegas] 

18-19 March 2019 - Philippine Nickel Industry Association (PNIA) organised and launched The Nickel Initiative 2019 Conference at Shangri-la at the Fort in Taguig City. The event's objective is to provide a venue to discuss issues and potential opportunities or collaborations for the various industries that are involved in the nickel supply chain. The event also featured companies involved in the exploration, extraction and processing of nickel. According to PNIA, The Nickel Initiative 2019 Conference aims to open doors for improved networking and collaboration among stakeholders and industry players in the Philippines and abroad.

Price, policy constraints and challenges were among the major issues discussed during the conference. The establishment of a roadmap for the industry was a goal mentioned by PNIA as they aim to leverage on the Philippine's position as the second biggest producer of the key input in stainless steel, mobile phones, transportation and electric vehicle batteries. This roadmap is intended to provide a foundation that would accelerate growth in the local nickel industry and to further contribute to the country's economic expansion. The roadmap will also address the industry's needed infrastructure, incentives, power, as well as peace and security. [1] The PNIA stated that they are hoping to finalize the nickel industry roadmap within a year. [2]

The two-day event had attendees from local and global nickel stakeholders from the private and public sectors.

Mr Clarence J. Pimentel, Jr., Conference Chair of The Nickel Initiative 2019, gave the Welcome Remarks. This was followed by Atty. Dante R. Bravo's message and Q&A portion with ANC's News Anchor, Mr Quintin Pastrana. Mr Pastrana is the President of WEnergy Global Pte Ltd., a graduate of University of Oxford, University of Cambridge and Georgetown University.

The keynote speaker for Day 2 was the former Philippine President and currently the House Speaker, Honourable Gloria Macapagal-Arroyo. From her speech, she mentioned her support for the industry and its endeavours. The House Speaker is hopeful that Congress will be able to pass the new fiscal regime measure for the mining sector before the end of 17th session of Congress in June. [1] This refers to the House Bill No. 8400 which she co-authored.

For large-scale metallic and non-metallic mining operations outside of the mineral reservations, they will be required to pay the government a margin-based royalty on income from mining operation. It was noted that the rate is raised from 1.5% royalty to 5% royalty. This is from a 10% to a 70% margin. [1] On top of this, a royalty tax equivalent to 3% of the gross output of minerals or mineral products extracted or produced by the mining operation will also be imposed on large-scale metallic and non-metallic operations if this is located within mining reservation areas and this is exclusive of all other taxes. This means that they still have to pay corporate income tax.

For small-scale mining, the House Speaker mentioned that the mining contractors within or outside mineral reservations will pay to the government a royalty equivalent to one-tenth of one percent of gross output. [3]

She noted that the measure would generate around PHP22 billion for the government from the current PHP19 billion (or PHP18.71 billion) as well as an additional PHP3 billion from the royalties collection. With regards to mining royalty, she stated that the government will earn PHP2.57 billion instead of the current PHP1.13 billion. [3]

Furthermore, the House Speaker said that HB 8400 was adopted by the Senate committee level with an objective to promote fairness by providing fiscal regime that is applicable to all existing and prospective large metallic and non-metallic, and small-scale mines. It shall be applied to all mines regardless of whether the mine is located outside or inside of mineral reservation. This measure would also "enhance the equitable share of the government in the utilization of natural resources without compromising the mining sector's need for reasonable return on its investment." [3]

Mr Dante Bravo, President of PNIA, said that they welcome the measure. He hopes that the approval of the House Bill would eventually push the lifting of the moratorium on new mining permits.

The House Speaker also noted that the local mining industry flourished under the present administration than it did during her regime despite the current President's stand on mining. "I have said that even under my successor, who was very strict about mining, the sector grew even more than it did in my time," she said. "That's what we want to do now. Even in today's policy and regulatory environment, we want to help the sector grow and contribute to national development." However, she emphasised that there should be a solid framework that will approximate the thinking of President Rodrigo Duterte. [3]

In relation to President Duterte's message during his 2018 SONA, the House Speaker pointed out that raw materials from mining operations in the Philippines should be processed here. She said, "In line with the President's other statements regarding raw materials...your projects would ideally include processing facilities if not today, at least in the realistic future.”

The House Speaker also proposed that the Department of Environment and Natural Resources (DENR) should also transform into a promoter of responsible mining aside from being a regulator.

From her keynote speech, she emphasised as well the importance of educating the public on the aspect of land rehabilitation since there are several remarkable examples such as Berong Nickel, Coral Bay Nickel, and Rio Tuba in Palawan; Agatha Mining and SR Metals in Agusan del Norte, Taganito Mining in Surigao del Norte, Zambales Diversified Metals in Candelaria, Zambales.

Hon. Arroyo also mentioned the old mined pit of Semirara which is now a blue lagoon after the company's marine rehabilitation efforts in the island. This environmental rehabilitation brought international attention and the company was awarded in 2015 as first runner-up in the Corporate Social Responsibility category of the Asean Energy Awards in Kuala Lumpur, Malaysia.

After the speech of Hon. Arroyo, Undersecretary Rafaelita M. Aldaba of the Department of Trade and Industry gave a presentation about "Securing the Future of the Philippine Industries".

On the second part of the morning session, the topic was "Discovering Nickel and Tomorrow's Industries". The presenters were Mr Paul White (Secretary General of International Nickel Study Group), Mr Edmund A. Araga (President of Electric Vehicle Association of the Phils.) and Mr Lawrence Liu (Tsingshan Holding Group Co., Ltd.).

The afternoon session's topic was "The Next Generation of Innovators and R&D Champions" where a Q&A panel was moderated by TV host Mr RJ Ledesma. The panelists were Mr Earl Forlales (CEO and Founder of CUBO Modular) and Dr. Rogel Mari Sese (President of Regulus Space Tech Inc.). Mr Forlales presented an innovative and low-cost housing solution for the urban poor that uses bamboo as building material. It has a practical home design that is easy to assemble but durable for years. Dr. Sese talked about outer space mining and its legal implications on a global scale. He passed around to the audience a sample of a meteorite that landed in Russia which he said is composed mainly of nickel.

The segment's moderator, Mr Ledesma has been popular in Philippine television since the late 1980s for appearances in various commercials and TV shows, representing Generation X with wit, humour and flair. He is a writer, editor and entrepreneur, co-founder of the successful Mercato Centrale food market, and the Honourary Vice Consul of Monaco to the Philippines. He is the first Asian to deliver the graduation speech at the Massachusetts Institute of Technology where he received a degree in Masters of Science in Real Estate Development.

Other presenters for the afternoon session were Mr Cyrille Jouin (Glencore International AG), Mr Ian Hiscock (CRU Consulting Group) and Mr Weixun Huang (Ningbo Lygend Mining Co., Ltd.).

Dr. Bernardo M. Villegas gave an insightful and informative closing keynote presentation titled “Nickel Mining Can Be Sustainable”. Dr. Villegas is an economist and professor at the University of Asia and the Pacific. He is also a book author and a leading expert in economics. Dr. Villegas is one of the best economists of the Philippines due to his unparalleled expertise and wisdom. From his speech, he emphasised the important role of the Philippine government in the survival and success of the local mining industry.

- - - - -

At the end of the day, with all the talks and sharing of ideas, studies and opinions, the success or failure of the Philippine nickel industry in solving its impending problems and challenges is dependent on how well the key players are able to differentiate between the best solutions from false limiting beliefs. After the conference, here are some thoughts, reactions and expert analyses from some of the delegates who attended the Nickel Initiative Conference 2019:

- - - - -

“I am convinced that nickel demand will continue to rise in the future. Profit can be made if we are properly positioned. Trading of nickel in the Philippines is a sustainable project or business. The initiative was good as the problems unique to the industry were identified and discussed and a possible solution was talked about. The event was also a fresh ground for meeting new contacts and renewal or updating with former acquaintances.” (Ms Audi Fabricante, Business Manager at Epitomo Holding Resources Pte Ltd. and Principal at Fahaodi Mining Consultancy)

- - - - -

"The Nickel Initiative conference was very informative. Current regional and world trends were covered by industry experts from various countries. The speakers were able to cover topics from nickel extraction to stainless steel usage and even emphasised the demand for raw materials for electric vehicles. Next time, I hope, in the next conference, there will be discussions on worldwide trends or sharing of best practices that companies adopt to minimize environmental and social impact of the mineral extraction and processing." (Ms Maan Baribar, Community and Public Relations Senior Manager of Sumitomo Metal Mining Philippine Holdings Corporation)

- - - - -

“During the conference, I heard lots of well-intentioned speeches but the challenge is for industry leaders and authorities to create a clear roadmap with practical steps to achieve quickly a shared vision. I hope that this will emerge soon because we need it. It seems that there was no Philippine company mentioned who is willing to put up a nickel processing plant locally to add value to the large laterite nickel resources of this country. Perhaps most companies prefer direct shipping of ore to overseas markets at prices of less than 10% of the contained nickel content.

“Indonesia banned the shipment of laterite nickel ores in 2014 and now has over 25 companies operating or building processing plants, with the production of over 750,000 tpy nickel metal in product by 2023. All the Chinese producers who attended the Nickel Initiative stated they will NOT invest in the Philippines as they already have investments in Indonesia. Interestingly, Indonesian companies cannot export laterite ores unless they are building a processing plant. The same policy should be immediately implemented in the Philippines.

“Nickel Asia/Sumitomo at their Coral Bay and Tanganito has been the only company in Asia processing local laterite nickel ores to produce raw materials for batteries. This company has been the sole producer for the last 15 years but is now at risk of being overtaken by the Indonesian companies as they start work on three planned HPAL plants. From a position of absolute advantage, the Philippines will lose its position in the battery sector. It has already lost the race in producing ferro-nickel or nickel pig iron and will never be able to compete with the Chinese companies in Indonesia.

“Banning the immediate export of laterite nickel ores is the only way to force companies to invest for the future and for the benefit of the Filipino people. Without an immediate ban on exports, the fourth largest resource of laterite nickel and cobalt in the World will become irrelevant as we watch our Asian neighbors grow to lead the world in battery materials production and stainless steel production from laterite ores,” (Mr George Bujtor, 12th April 2019)

Mr Bujtor is a prominent mining executive from Australia with 23 years of experience in various roles such as General Manager and Managing Director in Rio Tinto, Australia. He is an expert in the technical, financial and commercial aspects of mining operations. In the Philippines, he was the CEO of Toledo Mining Corporation in 2005 where he developed in record time, commercialized and operated the Berong Nickel Mine in Palawan. He was also the CEO of Carmen Copper Corporation in 2009 (under Atlas Consolidated Mining and Development Corporation), the largest porphyry gold-copper producer in the Philippines. He has a degree with honours in BASc Geology, Mining and Metallurgy; Master's Degree in Mineral Economics; Master's Degree in Mining Engineering and M.B.A. Mr Bujtor is currently the CEO of Electric Metals Limited.

-----

References:

[1] Rodriguez, Bruce (19 March 2019). "Policy and global metal price constraints tackled at Nickel Initiative 2019" on ANC 24/7. Retrieved from https://www.facebook.com/ANCalerts/videos/607666546327913/

[2] Retrieved from https://www.pna.gov.ph/articles/1065046

[3] Ison, Lilybeth (19 March 2019). "Arroyo optimistic about bill on new fiscal regime for mining". Retrieved from https://www.pna.gov.ph/articles/1065024

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Philippine Resources - January 21, 2021

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At the height of the COVID-19 pandemic in the Philippines – that brought the nation’s economy to a virtual standstill and left thousands confined to hospitals, stricken with the deadly virus – communities in Mindanao have benefitted from an unexpected partner that immediately and actively responded to the government’s call to unity: and that is the country’s mining industry, which continues to support countrywide development.As of this writing, the industry has realigned some Php247 million of its collective Social Development and Management Program (SDMP) funds to provide relief for thousands of Filipinos in and around mining communities and close to 70,000 frontliners across the country.Immediate responsePrior to the realignment of SDMP to support relief operations, TVIRD’s Agata Mining Ventures Inc. already dispatched various Personal Protective Equipment (PPEs) from Manila as part of its immediate response to the needs of medical frontliners in the Mindanao region. TVI Resource Development Philippines Inc. (TVIRD) has facilities in Siocon, Zamboanga del Norte; Bayog, Zamboanga del Sur; and the adjacent municipalities of Tubay, Jabonga and Santiago in Agusan del Norte Province where its Agata Nickel Project is located.To date, the TVIRD Group of Companies has shored-up critical PPEs: N95 face masks, face shields and surgical and examinations gloves to support COVID-19 frontliners, including LGUs, volunteers, medical workers, police and civilian volunteers as well as checkpoint personnel. It likewise sourced majority of its fresh vegetable from farmers and other goods from local establishments to provide relief to more than 10,000 families in its respective areas. 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Together with its beneficiary farmers, locally-sourced ampalaya (bitter gourd), kalabasa (squash), okra, sitaw (string beans) and eggplants were included in relief packs – which were distributed to 2,647 families in its three host municipalities.Recipients also included the company’s employees in the mine site and the indigenous Mamanwas who are themselves farmers who would have otherwise faced the risk of spoilage of their produce due to ECQ restrictions on transportation. Over 11,000 kilos of assorted vegetables were included in more than 5,200 relief and vegetable packs distributed by the company – a testament that its production model under the Mabakas framework is sustainable. TVIRD likewise rolled-out a weeklong food distribution program and reached-out to almost 7,424 families in the Zamboanga Peninsula. 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Philippine Resources - January 21, 2021

Taganito Mining Donates 7k Workbooks for Surigao Del Norte

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Marcelle P. Villegas - January 29, 2021

Rare blue agate from Brazil with the face of Cookie Monster

A rare piece of volcanic agate rock was discovered in the Rio Grande do Sul region near Soledade in Brazil last November 2020. It is an oval-shaped rock with a hard, white pitted outer shell. On the outside, it looks like a perfect egg. When you split the rock at the center, you will see in each of the two halves a strange resemblance of Cookie Monster, a character from the famous children’s television show “Sesame Street”.[1] At first look, the rock’s photos and video which went viral on the internet seems surreal, but it is actually a unique piece of rock that was naturally formed in a volcanic environment, according to its owner. The rock is a deep blue quartz crystal and was discovered and found by Lucas Fassari, a gemologist and explorer in Brazil. [2][3] It was sent to Mike Bowers in California. Bowers is an American geologist and specializes in these types of rocks. He said that it could be worth as much as $10,000 due to its rare features. [1] Bowers uploaded on his personal social media account a video of the rock with the caption “Cookie Monster agate from Brazil” with a background music of Cookie Monster singing about the letter “C”. His post immediately became viral online. The actual cost of the rock when bought from Fassari was not revealed by the current seller. [3] “I think this is probably the most perfect Cookie Monster out there. I have seen others but here you have it complete on both sides. This is very unusual. There are a few famous agates out there: the owl, the scared face. There are many approximate ones but it is rare to find one so well defined like this,” Bowers said. “Prices can be very high. I was proposed over $10,000 by five different buyers. Rare.” While his viral video of the Cookie Monster agate is fascinating, it also brought some doubt to most people. Is it really possible for nature to produce a semiprecious stone with such strange appearance? What are agates and how are they formed in the first place? Geology.com described the agate as a translucent variety of microcrystalline quartz. It is formed by the deposition of silica from groundwater in the cavities of igneous rocks. Agates are formed by the deposits of silica from groundwater in the cavities of igneous rocks. The agate deposits in concentric layers around the walls of the cavity or in the horizontal layers building up from the bottom of the cavity. As a result, layered patters are then formed. In some agate formations, these cavities are lined with crystals, therefore called geodes. A geode is a round rock with a hollow space lined with crystals, just like the Cookie Monster agate. Agates come in a wide range of colours such as brown, red, yellow, gray, black, pink and white. The colours are produced by the impurities during its formation and they are formed in alternating layers within the agate. Now, the variations in colours are produced once groundwater of different compositions leak into the cavity. The banding within a cavity is a manifestation of change in water chemistry. As an end result, agates end up having interesting colours and patterns. Based on this general description of agate, the authenticity of the Cookie Monster agate seems legitimate. Bowers reported to Daily Mail UK that the rock is indeed real. [1] A fact-checking website, Snopes.com. also claimed that rock is authentic. [3] TechnologyTimes.pk on the other hand stated, “As of the moment, there are no news yet as to whether Bowers actually intends to sell the rock or not, and about its current value as of the moment. Furthermore, no authorities have confirmed whether the rock is real or fake. If it is, sure enough, its value will increase over time as more and more people take interest in the unusual rock. Who would’ve known Cookie Monster would make so much numbers in a rock?” (--Marcelle P. Villegas, PRJ) Reference: [1] Boyle, Darren (19 Jan. 2021). Daily Mail UK. "What a muppet! Geologist finds incredibly rare lump of volcanic agate rock which looks exactly like Sesame Street's Cookie Monster". Retrieved from - https://www.dailymail.co.uk/news/article-9162441/What-muppet-Geologist-finds-rock-looks-like-Sesame-Streets-Cookie-Monster.html [2] Hart, Matthew (26 Jan. 2021). Nerdist. "Gemologist Cracks Open Rock, Finds Cookie Monster's Face". [3] Evon, Dan (26 Jan. 2021). Snopes. "Is the 'Cookie Monster Rock' Real?". [4] Noor, Mufliha (25 Jan. 2021). Technology Times.pk. "'Cookie Monster' Rock From Brazil: Real or Fake?".

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Mining Operational Excellence Through Digital Transformation

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Philippine Resources - May 22, 2023

Customer’s First Choice: Sandvik Philippines Delivers 11th and 12th Pantera DP1500i Drills to Filminera Resources Corporation

Sandvik Philippines has successfully commissioned and delivered to loyal customer Filminera Resources Corporation (“Filminera”) their 11th and 12th Pantera DP1500i Top-hammer Surface Drills last 25 January 2023 at the Masbate Gold Project (MGP) located in Masbate Island, Philippines. Photo shows Sandvik Technician Larry Lugnas (second from left) and Service Operations Manager Jorge Cabello (third from left) handing over the drills to MGP representatives. Located 360 km southeast of Manila, the Masbate Mine is operated by Filminera, the Philippine subsidiary of TSX- and NYSE-listed B2Gold with headquarters in Vancouver. In 2022, the mine produced a record-setting 212,728 oz of gold out of 7.93M tonnes of ore milled at an average grade of 1.11 g/t.  B2Gold also operates the Fekola Mine in Mali and the Otjikoto Mine in Namibia. Their projects under development include the Anaconda Area in Mali and the Gramalote JV Project in Colombia. The Masbate Mine started operating in 2008 initially using 4 x Atlas Copco ECM660 Drills owned and operated by the erstwhile mining contractor, Leighton. When the opportunity for re-fleeting came about in 2012, Sandvik succeeded in winning the tender which came packaged with a full maintenance contract for 24,000 service meter hours of five years. Ironically, the said maintenance contract almost led to the cancellation of the order for the first 4 x DP1500i due to a dispute with the rates. Eventually, both Leighton and Sandvik were able to arrive at a mutually acceptable arrangement, and Sandvik ran the service contract for five years without incurring penalties in the availability guarantees. The contract was so profitable, Sandvik even had to share some of the residual profit at the end with Filminera under the pain-and-gain proviso of the contract. The next re-fleeting opportunity came in 2017, with the Masbate Mine. This time, there was no service contract attached to the equipment and Leighton was no longer the mining contractor; the mine has shifted to owner-miner operation. Sandvik managed to secure the repeat order for another batch of 4x DP1500i, banking on the proven performance and reliability of the first four. That brings the total to 8 units. Drill numbers 9 and 10 were ordered in July 2020 and delivered in 2021. Numbers 11 and 12 in the photo above were ordered in January 2022 and are now handed over to the customer. Filminera ordered two more DP1500i’s in November 2022; these machines are now awaiting completion in Tampere, for delivery later this year. That should bring the total to 14 x DP1500i units spread over 11 years for our most loyal Pantera DP1500i customer in the Philippines – Filminera Resources Corporation!

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