Chamber of Mines Pushes for Policy Reforms

Atty. Michael T. Toledo, Chairman at Chamber of Mines of the Philippines [Photo by the author]

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[Oct. 17, 2024] The Westin Manila -- Digging Deeper: A Mining Philippines Policy Forum is a one-day conference that tackles the most pressing legal and regulatory issues of the mining industry today.

On his Welcome Address, Atty. Michael T. Toledo, Chairman at Chamber of Mines of the Philippines, emphasized the need to address key challenges in the country’s mining sector. Toledo outlined the obstacles hindering the country’s mineral processing industry and called for immediate reforms to boost investor confidence and secure the industry’s long-term future.

He mentioned that these challenges have driven mining investors away from the Philippines and must be resolved to realize the common goal of the Marcos administration and the mining sector.

These are: (1) long-term policy consistency, (2) the long and complex approval process for exploration permits and mineral agreement applications, (3) business continuity risks from LGUs and communities, and (4) tax uncertainties and lack of adequate benefits to invest.

He pointed out that recommendations were already submitted to the President during a meeting in Malacañang recently. The recommendations are:

“First, assure long-term policy consistency via the drafting of a robust mining policy that would, among other things, clarify the role of national and local government units and specify the approach to Indigenous community management,” he said.

“Second: Simplify and expedite approval processes for mineral agreements by reducing application steps, eliminating redundancies, and imposing clear-cut timelines, in close coordination with government agencies with which our industry interacts.  We also recommended the implementation of an online register of pending applications.”

“Third: Minimize business continuity risks from local ordinances by: (1) clarifying the status of mining companies as government contractors and exporters to be consistent across national and local laws; (2) rationalizing LGU power to issue ordinances that prohibit mining or specific mining methods within their jurisdictions; and (3) requesting ARTA to identify and fix redundancies between national laws and local ordinances, and empowering it to suspend the implementation of those inconsistent with the Ease of Doing Business Act and the LGU Citizen’s Charter.”

Finally, he stated, “Our fourth recommendation is: Address uncertainties in tax policy and investment incentives by: (1) Establishing a stable and predictable mining fiscal regime (2) Including a ‘financial stability clause’ in all mineral agreements to guarantee continuity of mining operations and to assure the sanctity of contracts, regardless of material adverse change in government policies that would prevent mining contractors from performing their obligations (3) Strengthening the potential of the industry by appointing a senior government official who will focus on addressing obstacles to mining investments and on promoting and marketing the industry.

Toledo added, “Only if these recommendations are taken and put into action, we told President Marcos, can we be able to produce enough minerals to feed the mineral processing facilities we aspire to build.  Only then can we really be a significant player in the global energy transition movement.”

DENR Introduces Digital Applications to Streamline Mining Approvals

The Department of Environment and Natural Resources (DENR) took a significant step toward streamlining mining processes by rolling out a digital application system in three key regions, including CARAGA and Davao. DENR Undersecretary for Integrated Sciences, Carlos Primo David, announced this during the forum, stating that the new system aims to reduce the approval time for mining permits from the current 7 years to just 2 years.

“When you start to evaluate applications, there are always technical and legal aspects and it depends on the person evaluating that. We want to track where these tracks are getting stalled,” he said.

David said that like the ECCs, the application always starts in the Regional Offices. He noted that the system is still imperfect, so there’s a need to iron out some kinks.

However, he gave assurance that the digital application process prevents some indiscretions that causes delays in the mining applications.

The DENR also introduced a parallel processing system, where permit approvals can be initiated without waiting for other regulatory bodies, such as local government units (LGUs) or the National Commission on Indigenous People (NCIP), to finalize their own approvals.

COMP Members Strive for Best Global Practices

In a separate discussion during the forum, COMP announced that four of its operating members have achieved performance levels on par with global best mining practices, as measured by the Towards Sustainable Mining (TSM) standard.

Filminera Resources Corp.’s Masbate Gold Project received the highest verified ratings of AAA in TSM’s Biodiversity Conservation Management across all of this Protocol’s 3 Indicators. Philex Mining Co.’s Padcal Project received a rate of AAA in all 6 Indicators under Tailings Management. 

TVI Resource Development Phils., Inc. was rated AAA in 3 of the 4 Indicators under Water Stewardship.  Taganito Mining Co. received the highest scores in 4 of the 5 Indicators under Safety & Health, as well as in all 5 Indicators under the IP and Community Outreach and Social Development Management.

Toledo said, “TSM provides us a roadmap with which to measure our performance on important areas that our stakeholders, especially our host communities, care about.  We now know how to achieve global mining best practices, and our members will constantly strive to reach the highest ratings towards better ESG performance, and consequently, improved relationships and bottom line.”

The 4 companies were among the 8 COMP operating members that were randomly selected this year to undergo external verification of their self-ratings for their 2023 TSM performance. The other 4 companies that were subjected to verification are Platinum Group Metals Corp. Surigao Project, Carmen Copper Corp., FCF Minerals Runruno Project, and Cagdianao Mining Co. 

All of COMP’s 19 members with active mine sites submitted their TSM self-assessment results earlier this year.  The 11 other self-rated mines will be verified in 2025 for their 2024 performance.

Most of the verified mines showed good assessments in IP Community Outreach & Social Development Management, as well as Safety & Health.  However, there is a need to improve in the Water Stewardship and Climate Change Protocols.

TSM was established by the Mining Association of Canada in 2004 and adopted by COMP in 2017. 

From the media release of COMP, TSM is defined as a set of tools and indicators to drive performance and ensure that key mining risks are managed responsibly, and best practices are used at members’ facilities.  It is currently being implemented in 15 mining jurisdictions worldwide.

This year marks the first year of COMP’s full implementation of the program.  The association of the Philippines’ biggest large-scale metallic mining firms had been preparing for TSM since 2018. Their preparation also entails the Filipinization of TSM Protocols and Indicators, the formation of a multi-sector advisory panel, the accreditation of external verifiers, and the development of the TSM online submission app.

The external verification reports for the 8 mines can be found in the COMP website.

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