By Marcelle P. Villegas Previously, we featured an update on the mining regulations in the Philippines. We also examined the export volumes of nickel ore from the Philippines and how these had been affected by Indonesia's exports. Lastly, we discussed the viability of the Philippines' laterite ore deposits and what this could mean for future production. These were the scope of a presentation by Mr George Bujtor last September at the 7th Asian Nickel Conference in Jakarta, Indonesia. His report is titled “Philippines: Regulatory Update and the Potential of the Philippine Laterite Ore” - “How the Philippines was Surpassed by Indonesia in the Laterite Nickel Industry”. Mr Bujtor is the CEO and owner of private companies, namely Electric Metals Limited (EML) in Hong Kong and PT Electric Metals Indonesia. These are companies which are developing the innovative EML Process for the low-cost leaching of nickel laterite ores. The EML Process is the first of its kind in green technology in nickel processing, and he introduced this at the Asian Nickel Conference in Indonesia last September. Mr Bujtor is an expert in the technical, financial and commercial aspects of mining operations with over 35 years of experience in the industry. He has extensive work experience in the past as General Manager and Managing Director in Rio Tinto, Australia. In the Philippines is the former CEO of Toledo Mining Corporation and Berong Nickel Mine in Palawan, as well as CEO of Atlas Mining Corporation. As a review from Part I of our article, we learned from Mr Bujtor that the Philippines is currently Asia's leading supplier of nickel and cobalt which are raw materials for the battery sector. He stated that with the right policies, the Philippines could become one of the world's leading suppliers of battery raw materials, including battery manufacturing. [1] He said, "Both the Philippines and Indonesia have the resources to dominate the nickel industry. The future growth will be in stainless steel and the battery sector. " "Over the next 4 to 5 years, nickel demand growth will be in the stainless steel and battery sectors. Indonesia will continue to dominate the NPI growth and investment. The Philippines will only be able to compete in the battery sector." Now, what is the future of the Philippine laterite nickel ores? With regards to the competitiveness of Indonesia versus the Philippines, he mentioned that, "Relative to Indonesia, the Philippines has NO competitive advantage in ferro-nickel production." He gave the following key points: Indonesia has built, and continues to build, power stations to provide the electricity to its ferro-nickel industry. The Philippines has limited coal resources and a negative view of coal-fired power stations. With past high grading and sales of saprolite ores, little high-grade saprolite tonnage remains in the Philippines to produce low cost ferro-nickel/NPI. Indonesia has the advantage of having considerably higher saprolite ore grades and lesser environmental controls. These are key cost drivers. The future for the Philippines is not in ferro-nickel or NPI. He concluded, "The future of the Philippines lies in the processing of its laterite ores as battery raw materials…” Here is why: The Philippines is currently one of two producers of battery raw materials in Asia, through the Nickel Asia/Sumitomo JV. Sumitomo has the world’s leading technology for HPAL. The Philippines has large resources of laterite ores with medium to high Ni, Co & Sc grades. Hydrometallurgical processes like HPAL require very little electricity relative to ferro-nickel production. The Philippines leads the world in an innovative atmospheric leaching process adapted for the tropics – ‘The EML Process’ –a low cost atmospheric leaching process. Green products for a green future As mentioned earlier, The EML Process is the first of its kind in green technology in nickel processing. "The low environmental impact either locally or globally of the EML process not only produces products green in colour (nickel), but green in nature to promote the ever-increasing demand for battery and related metals to combat the continued burning of fossil fuels and consequent global environmental pollution." [2] The EML Process was developed in the Philippines. It is an atmospheric leaching process (done at room temperatures and pressure) adapted to treat all laterite nickel ores. (The two methods of atmospheric leaching done by EML are vat leaching and tank leaching.) Here are some key points: Test work undertaken in the Philippines leveraging off Cu, Au, Li and Ni experience “Closed system” with leached ore placed back into mined-out areas –no emissions to land, air or water Lowest carbon footprint and environmentally the “greenest” of all Ni technologies Disruptive technology with lowest capital cost in the industry at Does not require a power station [1] "The EML Process is not only simple and safe but provides an environmental solution to the laterite nickel industry hitherto much maligned for its poor environmental rehabilitation performance, excess CO2 emissions and excess waste generated." “The principals behind Electric Metals Limited have developed an innovative leaching process to treat tropical nickel laterites, both saprolite and limonite ores. The process can also be applied to other ores of lithium, copper gold, uranium etc.” “The leach process has industry lowest capital costs and is environmentally far superior to the more complex and expensive technologies such as the High Pressure Acid Leach (HPAL) and Rotary Kiln Electric Furnace (RKEF) processes.” [3] The three essential steps in the EML Process include: 1. Leaching of the laterite ore: Mined ore is contacted with dilute sulphuric acid to dissolve the nickel & cobalt (as well as other metals like aluminium, scandium, manganese, etc). 2. Metals Recovery: Solutions containing the metals of interest are treated to recover the contained nickel & cobalt initially, as a mixed hydroxide product containing 35% to 55% nickel and 1% to 3% cobalt. 3. Neutralization: Leached ore is washed and neutralised prior to being returned to the mined-out open pit. The leached ore residue is non-toxic and chemically inert and suitable for revegetation or agriculture. In summary, while the issue of nickel processing and environmental concerns may be a topic of debate among environmental activists and industrialists, the solution lies in having a gamechanger in the nickel processing arena. Today, we now have a low-cost and environment-friendly nickel processing method called The EML Process. This offers a promising future in the industry and for the environment as well. ----- Acknowledgement: Thank you to Mr George Bujtor of Electric Metals Limited. ----- Reference: [1] Bujtor, George. (11 Sept. 2019). “Philippines: Regulatory Update and the Potential of the Philippines Laterite Ore -- How the Philippines was Surpassed by Indonesia in the Laterite Nickel Industry”. Presented at Asian Nickel Conference 2019, Jakarta Indonesia [2] Retrieved from Electric Metals Limited website - https://electricmetalsltd.wordpress.com/ [3] Bujtor, George and Wallwin Peter. (02 May 2020). “The EML Process”. Electric Metals Limited investor flyer. Photo credit: Marcelle P. Villegas, Philippine Resources Journal

Atty. Dennis A. Quintero, PABC Chair - Presenting the Brief History of Philippine Mineral Reporting Code (PMRC) at the "Focus Group Discussion on the Philippine Mineral Reporting Code and Its Relevance to the Philippine Mineral Industry", Sofitel Philippine Plaza Manila - 10 Sept. 2019 (Photo by Marcelle P. Villegas, Philippine Resources Journal) By Marcelle P. Villegas When the Chamber of Mines of the Philippines organised their annual Mining Philippines last year in September, one of the most important parts of their three-day international conference and exhibition took place on its first day at the Sulu Room of the Sofitel Philippines Plaza Manila. It was a small gathering in a separate venue outside of the main conference -- the “Focus Group Discussion on the Philippine Mineral Reporting Code (PMRC) and Its Relevance to the Philippine Minerals Industry”. Although the discussion took place last September, the further development of the PMRC is something to look forward to this year and perhaps even the following year. The Philippine Mineral Reporting Code or the “Code” was created to set out minimum standards, recommendations and guidelines for Public Reporting in the Philippines of Exploration Results, Mineral Resources and Ore Reserves. “The Code was formulated with the intent of setting minimum standards for public reporting on minerals that is compatible with global standards. The formulation of the PMRC relied on the international codes from Australia, South Africa, European Union and Canada,” according to the Philippine-Australia Business Council (PABC). The closed-group discussion was moderated by Atty. Ronald S. Recidoro, COMP Executive Director. Atty. Dennis A. Quintero (PABC Chair and Meeting Chair) started the event with an “Introduction of Meeting Attendees and Brief History of PMRC”. "The idea of having a Philippine Mineral Reporting Code started during one of the mining roadshows in Australia, participated in by representatives from the Philippine-Australia Business Council. Back then, the Chairman was Atty. Leo Dominguez and the delegation was composed of the various mining industry stakeholders like the Chamber of Mines and also the Philippine Stock Exchange. And the idea came up that if Australia has its JORC (Australasian Joint Ore Reserves Committee), and [thought of] the idea for the Philippines to have its own as well. And that's how the idea of having PMRC came about,” said Atty. Quintero. Organizations that were involved in the promulgation of the PMRC back in 2007 were Philippine Minerals Development Institute Foundation, Philippine Society of Mining Engineers, Geological Society of the Philippines, Society of Metallurgical Engineers of the Philippines, Mines and Geosciences Bureau, Philippine Stock Exchange, Board of Investments, Chamber of Mines of the Philippines and Philippine-Australia Business Council. The Secretariat Head of the Geological Society of the Philippines CPAC, Engr. Ramon N. Santos reported on the “Basics of the Philippine Mineral Reporting Code 2007 and Its Implementing Rule and Regulations”. Mr. Joey Nelson R. Ayson (PMEA President) reporting on “PMRC: Updates and Relevance to the Mineral Industry”. Other speakers were (top left - right) Engr. Roger A. De Dios (PSEM National President) and Mr George B. Baquiran (GSP CPAC Chair) (Photo by Marcelle P. Villegas, Philippine Resources Journal) Engr. Juancho Pablo S. Calvez, Chief Metallurgist of the Mines and Geosciences Bureau and Member of the PRC Board for Metallurgical Engineering gave a rundown of the PMRC Committee Role and Composition. This was followed by a discussion on the Committee for Mineral Reserves International Reporting Standards (CRIRSCO) and International Reporting Codes by Mr George B. Baquiran. He is the Chairperson of the Geological Society of the Philippines - Competent Person Accreditation Committee (GSP CPAC) and PMRCC Standards Committee Chair. PMEA President, Mr Joey Nelson R. Ayson reported on “PMRC: Updates and Relevance to the Mineral Industry”. Included in his report is the CRIRSCO Membership Update (Task Force of International Council for Mining and Metals - ICMM): ● Feb. 23, 2019 - CRIRSCO-PMRCC MOU signed ● March 2019 - PMRCC-CRIRSCO Working Group formed ● Sept. 9-11, 2019 - Annual CRIRSCO Meeting in Washington D.C., U.S.A. ○ PMRCC Executive Committee attended (Jun Angeles and Jake Foronda) ● Proposed Timeline for PMRCC to become a CRIRSCO member ○ Aim by third quarter of 2020 ● Upgrading PMRC 2007 according to the CRIRSCO Reporting Template 2019 ○ Approved PMRC Code aim by second quarter of 2020 Mr Ayson also reported the “Bases for PMRC Review/Upgrade” wherein the primary basis is the CRIRSCO International Reporting Template 2019, and the secondary bases are JORC 2012 and NI 43-101. In conclusion, he stated the PMRC and PMRCC relevance to the Philippine minerals industry, namely: ● To protect investors in mineral exploration and mining ● To protect the capital markets from fraudulent practices ● To promote a common understanding in reporting mineral assets ● For our Philippine Stock Exchange (PSE) to be world class in attracting mineral investments, both domestically and internationally. PMRC Committee’s Relevance: ● Need for a Philippine-wide National Reporting Organization (NRO) to monitor the effectiveness and relevance of the PMRC and subject the PMRC to periodic reviewers ● Growing importance of compatibility and substantial equivalency with other international reporting codes ○ It is important to be a CRIRSCO member to ensure that PMRC Code will always be at par with the CRIRSCO family of internal reporting codes. Finally, the Open Forum was conducted by Engr. Roger A. De Dios, PSEM National President.

By Patricia A. O. BunyeOn 08 March 2020, the Philippine Government declared a State of Public Health Emergency throughout the entire archipelago in light of confirmation of the local transmission of COVID-19. All government agencies and local government units were tasked to assist, cooperate and mobilize resources to undertake critical, urgent and appropriate responses to address the exigencies of the situation. Since then, government agencies have been releasing the appropriate issuances to implement measures to combat the spread of COVID-19 and adapt to the crisis.The Mines and Geosciences Bureau (“MGB”), the government agency responsible for the conservation, management, development and use of the country’s mineral resources, likewise issued several memoranda instituting various measures to respond to the COVID-19 crisis, including realignment of funds, extension of deadlines, adoption of alternative work arrangements and implementation of safety protocols for operations in the mining sector. Realignment of Social Development and Management Program BudgetIn a Memorandum dated 27 March 2020, the MGB authorized mining companies to re-align unutilized funds from their Social Development and Management Program (“SDMP”) to assist host and neighboring communities around mining projects, as well as the non-impact barangays in their respective localities, until the threat of COVID-19 has abated. The principal objective of the re-alignment is to make use of the unutilized SDMP funds for the social amelioration of communities around the mining projects through the provision of health or hygiene kits and food packs in order to efficiently and timely respond to the needs of the communities to combat COVID-19. As of 27 May 2020, approximately Php297 million of the SDMP budget has been utilized to aid the concerned frontliners and households. Extension of DeadlinesAside from food and medical provisions, the MGB also provided legal relief by relaxing the rules on submission of documents and payment of fees, taking into consideration the logistical, social and economic difficulties encountered as a result of quarantine measures. In this regard, the MGB issued a notice allowing the extension of deadlines of the submission of reportorial requirements and proof of payment of occupation and other regulatory fees as prescribed under the Mining Permit/Contract up to 30 June 2020, or up to the immediate submission date when the pertinent quarantine is lifted. Protocols for the Resumption of Mining and Mineral Processing Operations under General Community Quarantine (“GCQ”)Following the recommendation of the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (“IATF-MEID”), the Philippine Government announced on 28 May 2020 that Metro Manila, along with other regions classified as low-risk and high-to-moderate risk areas for coronavirus transmission, would transition from a strict lockdown under the Enhanced Community Quarantine (“ECQ”) to a less stringent GCQ beginning 01 June 2020. While movement and transportation is limited under both quarantine protocols to avoid the further spread of COVID-19, the transition from the stringent measures of ECQ to the relaxed measures of GCQ is expected to benefit the economy and the workforce as it allows for the reopening of several industries previously ordered closed under ECQ for not being essential industries. With the easing of quarantine measures in most parts of the Philippines to support the economy, the mining sector and other select industries are now allowed to operate at limited or full capacity. However, since the threat of COVID-19 transmission is still present as cases continue to rise every day, operations of industries are allowed but remain subject to the condition that they follow strict safety protocols. In line with this, the MGB has released guidelines for the resumption of mining and mineral processing operations under GCQ under Memorandum Order No. 2020-004. Workforce and Working ArrangementsUnder the guidelines, a workforce anywhere between 50% up to full operational capacity at the mine/plant site shall be allowed, without prejudice to work from home and other alternative work arrangements. In order to determine who will be required to report for work, mining contractors or permit holders are mandated to conduct personnel profiling in accordance with the IATF-MEID guidelines. Employees not allowed to report for work or those who are prescribed to be on self-quarantine shall be subject to special work arrangements, such as work from home. Responsibilities of Mining EmployersAside from personnel profiling, mining contractors or permit holders are also required to provide for the necessary medical equipment and supplies, such as thermal scanners, masks, gloves, and hand sanitizers, as well as transportation to and from mine and plant sites and accommodation for employees residing five (5) kilometers away from the mine or plant site in order to reduce exposure to the virus and protect the workers from infection. To further ensure the safety and health of the mining workforce, mining contractors or permit holders are also enjoined to observe strict sanitation and physical distancing measures. Guidelines for shipment of minerals and mineral products In cases of shipment of minerals or mineral products, supplies and materials, the guidelines require that cargo vessels shall undergo a 14-day quarantine beginning from the time of its departure at the last port of call.No vessel crew may be allowed to disembark from the vessel and only personnel authorized by the Philippine Ports Authority and cleared by the Quarantine Medical Officer may board the vessel subject to observation of a “no contact” policy within the vessel. Additionally, miners are enjoined to follow measures to contain the spread of the disease, such as (a) submitting a Shipment Report containing the information on the crew list, the port of origin and the COVID-19 test results of the crew; and (b) passing through holding/disinfection areas for persons who shall board and disembark from the vessel.The guidelines, as well as the other measures implemented by the MGB, address the immediate impacts of COVID 19. In the longer term, mining companies need to consider the opportunities and risks arising from this crisis. While for some commodities, the short-term market demand may be low, other commodities like gold typically benefit in times of high uncertainty. Another so-called silver lining for the industry is the lower cost of energy, which usually constitutes 20-25% of operating costs.During this period, companies are also like to respond by rationalizing or streamlining their operations and their workforces, including automating more functions and processes. They will also be called upon to provide services, particularly in health care, to the host and neighboring communities ‘above and beyond compliance’ as these communities are often already underserved by the government.More than simply adapting to the crisis, mining companies are challenged to respond with resilience, particularly in navigating new or increased legal or financial risks. It is a brave new unprecedented world for us all, where only those who can embrace change will survive.Patricia A. O. Bunye is a Senior Partner at Cruz Marcelo & Tenefrancia where she heads its Mining & Natural Resources Department and Energy practice group. She is also the Founding President of Diwata-Women in Resource Development, Inc., a non-government organization advocating the responsible development of the Philippines’ wealth in resources, principally, through industries such as mining, oil and gas, quarrying, and other mineral resources from the earth for processing.