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Mining

Mining

Philippine Resources - March 18, 2019

65th Years of ANMSEC continues responsible mining advocacy

By Marcelle P. Villegas Last November 20-23, 2018 marks the 65th Annual National Mine Safety and Environment Conference (ANMSEC) in CAP-John Hay Trade and Cultural Center. The event was organised by the Philippine Mine Safety and Environment Association (PMSEA). In the Philippines, PMSEA is the leader in promoting occupational safety and health, sound environmental management and social responsibility in the minerals industry. PMSEA works in partnership with the Department of Environment and Natural Resources-Mines and Geosciences Bureau as well as with the Chamber of Mines of the Philippines, the Philippine Society of Mining Engineers (PSEM), other mining companies, quarries, cement plants, suppliers, service contractors and other professional organizations. On the Opening Day Ceremony, PMSEA President Dr. Walter W. Brown gave the Welcome Remarks. South African Ambassador to the Philippines, His Excellency Martin Slabber along with officers and directors of PMSEA participated in the Ribbon-Cutting Ceremony. The Mayor of Baguio City, Honorable Mauricio G. Domogan joined the ANMSEC celebration later that day along with the other PMSEA officers like Atty. Wilfredo Moncano, Mr Ramon Santiago and Engr. Louie Sarmiento who is the Immediate Past President of PMSEA.“It has been 6 decades of promoting Responsible Mining in the hearts and minds of Filipinos. With the theme ‘65 years of Responsible Mining Industry and Regulator Together in Promoting and Advocating Responsible Mining’, we believe that it is only through the collaborative efforts of both the industry and regulator will we be able to maintain a safe and sound, environmental-compliant and community-supported Mining Industry,“ said Mr Roel A. Colado, Chapter President. “We have been conducting worthwhile projects and upholding values and beliefs of our organisation.”For the week-long celebration of ANMSEC in Baguio City, the highlight of the event in the mining industry were the following:● PMSEA Immersion and Excursion Activity with Baguio Students● Welcome Cocktails at Baguio Country Club● Sports Fest (Badminton, Golf, Bowling and Lawn Tennis)● Mining Exhibit by Mining Companies and Suppliers● 4th National Minerals Industry Student Congress of students taking up BS Mining Engineering, BS Geology, BS Metallurgical Engineering and other related mining and geology courses● 6th Community Relations Officers Conference in cooperation with National Community Relations Practitioners in the Philippine Mining/Minerals Industry● Minerals Industry Symposium in cooperation with Philippine Society of Mining Engineers● Minerals Industry Parade● Mine Safety Field Demonstration and Field Competition on First Aid, Machine Drilling, Hand Mucking, Tug-of-Peace, Fire Extinguishing and Fire Brigade)● Testimonial Dinner and Annual Awards NightOn November 21, 2018, the 6th National Community Relations Officers Conference was held with the theme “Sustained partnership of regulators, mining industry & communities as pillars for developing a progressive society”. In this conference, they emphasised the important role of mining companies in educating and communicating with the public about the contribution of their mining company to the environment and to the whole country in general. Deploying smart and effective communication techniques are essential in relaying science-based information to a layperson who has no science background in order for them to understand the operations in a mining project. By consistently promoting correct information using all possible communication tools, mining companies will have a better reputation and better support from the public, rather than being unfairly stereotyped and generalised as destroyers of the environment.On November 22, 2018 was the schedule for the “Minerals Industry Symposium”. Dr. Walter W. Brown stated, “This symposium discusses and chooses best practices which are consistent with principles of sustainable development. Initially as a geologist and then as a mining executive for 58 years, I am pleased to have witnessed a gradual and broader appreciation of respect for the environment and responsible mining practices.” He concluded, “Rest assured that the PMSEA will support and participate in meaningful industry and government initiatives to bring about positive change for our industry and more importantly for the Filipino people.” Mr Roger A. De Dios, President of the Philippine Society of Mining Engineers said, “Over the years, the mining industry faced its ups and downs, but it is only in this current decade that it confronted severe anti-mining sentiments and stringent policy directions. Nevertheless, the mining industry has survived for we have shown that the industry and the government, as regulator, have satisfactorily done their share in fostering and carrying out responsible mining.”“We have to realize that minerals are so important in our life. ‘Without mining, life would be so difficult and uncomfortable.’ It is in this premise that we, as mining professionals, have the responsibility of making life on earth pleasant for all without compromising the environment,” said Mr De Dios.He further noted, “It is for this reason that the Philippine Society of Mining Engineers (PSME) will always be in the forefront in its advocacy in promoting responsible mining and even espousing beyond compliance. This Minerals Industry Symposium is one venue for presentations of best mining practices and principles reflecting sustainable development in the extractive industry.” The PSME-Northern Luzon Chapter organised and hosted this year’s Mineral Industry Symposium.

Mining

Philippine Resources - March 18, 2019

The Mining Industry & Renewable Energy

By Marcelle P. VillegasLast October 12, 2018, Diwata-Women in Resource Development, Inc. brought to the Philippine Mining Club Luncheon a panel of 2 eminent speakers to discuss about the possible collaboration of renewable energy (RE) with the mining industry.The topic for this meeting’s panel is titled “The Mining Industry and Renewable Energy”. The discussion covered the following: (1) Situationer on Renewable Energy; adoption by mining companies; (2) the business case for adopting Renewable Energy; and (3) Environment/Carbon Footprint Reduction. The first speaker was Ms Claire Lee who is the Vice President of Philippine Solar & Storage Energy Alliance or PSSEA (formerly Philippine Solar Power Alliance). Her career in RE started in 2009, months after the Renewable Energy Law was passed, and she joined Solutions Using Renewable Energy Inc. as its AVP for Operations. Ms Lee was later assigned to rural electrification using solar home systems, and with her leadership, they were able to distribute and install over 10,000 solar home systems in the off-grid areas of the Philippines.Ms Lee worked with Department of Energy and micro financing institutes and foundations where she helped the Government with their electrification targets. Additionally, she worked with U.S.A.I.D. where she led the group that installed the very first pure RE hybrid planned in Palawan. This hybrid system operated using clean alternative sources of energy such as wind, solar, storage and coconut shells. Ms Lee is also the Director of the Renewable Energy Association of the Philippines.The second speaker in the panel was Mr Michael Tetsuji Yamazoe who is the Country Manager of Sindicatum Renewable Energy since 2016. Mr Yamazoe has over 15 years of experience in consulting and business development. He graduated with a degree in Biotechnology from the Imperial College London. Mr Yamazoe is also well-verse in Akiva Hebrew and Middle Eastern studies.Mr Quintin Pastrana was the moderator and a speaker during the panel. Mr Pastrana is the President of WEnergy Power Pilipinas, Inc. He has over 20 years of leadership experience in the energy, natural resources and development sectors. Mr Pastrana studied in University of Oxford and earned a Master's Degree in Literature and Creative Writing, International Management and Public Policy Programme. From University of Cambridge, he has a Master's Degree in International Relations, Political Risk Mitigation and Competitiveness. He earned his MBA in International Management in Georgetown University, Washington D.C. He also studied in Ateneo de Manila University where he earned a degree in B.A. Political Science, minor in French Studies.In the Philippines, he was a News Anchor and Associate Producer at Bloomberg TV Philippines for their daily broadcast of "Starting Gate" and "In the Loop". Currently, he is the co-host of "On The Money" and "Shop Talk" on ANC.Mr Pastrana was named by the US-Asean Business Councils as one of its rising stars and also as one of the top Philippine young leaders by the Asia Society as a fellow at the Philippine Consul for Foreign Relations. He is the President of the award-winning Philippine Rowing Team. Additionally, Mr Pastrana is the Founder and Managing Director of the Library Renewal Partnership (LRP), a coalition of local and international partners that aims to empower over 2 million citizens by building at least 200 community education centers by year 2020, creating readers and leaders. (Please visit www.librarypartners.com.) During the panel discussion and presentation, Ms Lee reported about the Philippine Solar Energy Update by PSSEA. “Since 2010 we have been very active in a lot of government consultations and we have contributed a lot to some of the RE laws that involved solar. Since 2010, we've also produced and organised the Philippine Solar Summit, an annual event,” she said.She explained why solar energy is good for business. “The Philippines is right in the middle of the sun belt geographically so we are very much blessed with a lot of sun.” Ms Lee presented the national RE roadmap which will be updated eventually. “As you can see, in RE, hydro and geothermal are the leading RE sources,” she said. According to Ms Lee, “For the mining group, I think solar, being scalable and versatile, efficient and easeness of its operation and maintenance, makes it an ideal energy source for mining operations. Since most of the mines are located in the remote areas, most of the time, I think some of the mines are using solar hybrid installations which is a hybrid between solar technologies and diesel operated. But soon enough with the development of storage technologies, a lot of these power plants or mini grids can be wholly solar in the future.” Mr Pastrana added that there is an intersection between mining and the renewables which is full of gap, hoping that this dialogue will bridge this gap, “...and more importantly have collaborations between our sector in the renewables and the mining sector which does need reliable power these days, and really integrating into your operations and your footprint.” When asked about how the gap can be bridged, Mr Yamazoe answered, “With regards to the mining industry, since the main topic is the bridge between mining and renewables, at the end of the day RE is part of the business. People talk about RE being good because it is green or because it has good CSR. But at the end of the day, my view is it has to have some kind of benefit to whatever corporation or company you are involved in.”He added, “Now, what the mining industry has to do at this point is to take a good look at the cost and the benefits of RE. Nowadays, people are saying that solar is coming down. I think solar now is actually under the price of coal in a lot of places. So you could effectively say in some ways that solar is now at parity with coal. Coal is a base load, solar is not. it is intermittent and therefore you cannot compare them as two apples.” Regarding the involvement of the mining industry with RE, Mr Yamazoe stated, “You've got to take a good look as to whether you are thinking of this as a kind of CSR green initiative or a true business, because that is where your raw investment in the industry or in RE would differ.” Mr Pastrana shared his insights. “Since I wear three hats as a moderator, someone in the RE sector and somebody who belongs to the mining sector, understanding your footprint and your needs and your pain points, let me just talk about a particular case study. It seems to be very typical of the mining industry where you've got generators in your mine, you've got self-sufficient power. Most likely those are fossil-fuel based.”“Secondly, you likely will be under the open access scheme under the EPIRA (Electric Power Industry Reform Act) where you can buy over 750 kilowatts from a generator and pay the distribution utility where PECO or Meralco [will give] a willing fee. So that's the practicality of it.”“The third thing is, those power rates are actually discounted because you're buying them wholesale. So going back to Michael's point, the question will be, are you at parity or is there enough of an economic advantage for you to contract solar or renewables or build on your rooftop, avoid the transmission cost and actually generate on your own, partially, as a CSR project or really as something that will transform your business models into making your overheads go down and become a true green company rather than a greenwashing company.”About Philippine Mining Club:Running for 8 years now, the Philippine Mining Club is closely affiliated with the Melbourne Mining Club. The group was formed to create better relationships across all areas of the mining industry whose aim is to uphold a professional networking environment in promoting the exploration, extraction and minerals industry of the country.

Mining

Philippine Resources - March 15, 2019

Bezant Resources pursuing creation of Mankayan Copper Gold Mine

UK mining Company Bezant has since the beginning of 2018 refocused towards the development of an international copper gold portfolio focused on the Mankayan project in Luzon. In this period Bezant with its partner and MPSA holder Crescent Mining and Development Corporation ( “Crescent”) has:Appointed a new Bezant management team led by Colin Bird and Laurence ReadIncoming Chairman of Bezant, Colin Bird, is founder and chairman of the highly successful Jubilee Metals, one of the UK’s most profitable independent metals companies and oversaw the exploration of the Kalumbila copper project in Zambia, which was sold to First Quantum for $260m. Alongside him Laurence Read was appointed as CEO, who has a track regard in a major independent mine development financing and transaction.With Crescent reassessed the extensive historical project dataThis has included site visits with strategic groups undertaking new, independent geological and engineering assessments, extensive relogging of historical drill data, creation of a fly through graded model of the resource and culminated in an economic report published in February 2019. Asked in Manilla recently for the rationale behind the strategic change towards Mankayan and the Philippines Laurence Read, CEO, said “Changing copper market dynamics means Mankayan is ready to be a standalone, underground mine and our focus is on delivering that. Copper is about to see a major upheaval in price due to demand issues and the Mankayan project is a tier 1 asset which you can drive directly to from Manilla airport.“The Mankayan project has grid power access, infrastructure, a highly skilled work force and as a block cave underground mine with a long life is not affected by the current Philippine restrictions on open pit mining. Over the last ten years the world copper supply shortage and improvements in mining techniques have meant that sustainable mining grades have fallen from 1% plus copper equivalent to slightly over 0.6% in just a decade. This means Mankayan with a life of mine copper equivalent grade of 0.63% to 0.65% depending on mining strategy is an attractive proposition with a Snowden resource estimate defining an indicated resource of 1.1 million tonnes of contained copper and 3.7 million ounces of contained gold and an inferred resource of 0.2 million tonnes of contained copper and 0.6 million ounces of contained gold.Highlights of the new independent economic study by Mining Plus released in February 2019 are11 different mining strategies modelledFor the first time, a Sub-Level Caving (“SLC”) ‘stepping stone’ scenario, with two main Block Caving (“BC”) routes identified for progression, with life of mine production grade in excess of 0.64% copper equivalent (“CuEq”).Various sub $19/t cost optionsThe study focused on delivering the project into production with highly robust copper equivalent production grade, with a high gold content and uniformly sub $19/t costs. The three main representative options summarized below, are taken from the 11 modelled (the option numbers being those used in the study) Asked what lay ahead in 2019 Laurence Read said; “We have a lot of important strategic decisions to make but what we aren’t worrying about is the copper and the gold in the ground or that this will be major mine for the Philippines. Picking the right path for the mid to long term is key for Crescent and Bezant, but whoever we work with to develop this mine will have access to significant amounts of physical, cost effective, copper and gold from Mankayan production and will be able to command a major strategic advantage in the global metals space for the next forty years.

Mining

Philippine Resources - March 12, 2019

PH Nickel Industry Association at the PH Mining Club

By Marcelle P. Villegas“Nickel is all around us. As popular myths and research continue fanning endless debates on mining, an unpopular truth remains, the Philippines holds a strong track record for safe, responsible and sustainable mining. These practices catapulted the country into the roster of top nickel exporters worldwide. “ (an excerpt from the video presentation of Phil. Nickel Industry Association)Last August, Philippine Mining Club event presented Mr Isidro C. Alcantara, President of Marcventures Holdings Inc. as keynote speaker and as representative of Philippine Nickel Industry Association, Inc. or PNIA.PNIA is a non-stock, non-profit association duly registered with the Securities and Exchange Commission. The association was established in 2012 with a goal to promote and develop the nickel mining industry in the country, and aims to represent the Philippine nickel industry as the single voice to champion its cause with various stakeholders. The mining industry is a major backbone of the Philippine economy, and for that, PNIA believes that the government and the private sector have a big role as partners in developing this segment in the economy.The speaker, Mr Alcantara has a remarkable background related with banking and finance. He is a senior banker and former President and CEO of the Philippine Bank of Communications (PBCom), Executive Vice President of Equitable PCIBank, Senior VP of HSBC-Manila, and served four years as a Director of the Bankers Association of the Phils. (BAP). He is a certified public accountant and graduated with honours as magna cum laude with a degree in Economics and Accounting from De La Salle University, Manila. He also took Special Studies in Finance at Wharton School, University of Pennsylvania, U.S.A.He began his speech with gratitude for the attendees of the event who gathered to listen to the message of PNIA about the mining community. He states, “…hopefully we can inform, clarify and provide a factual and objective picture of the real status of the Philippine nickel industry. The Philippine nickel industry in particular and the entire mining industry is under scrutiny for its supposed shortcomings and inadequate environmental compliances. We beg to disagree. We contribute to the national economy and more significantly in a major way to the specific towns and provinces we are based in. Based on the [27th] information from the MGB in the Caraga region where the nickel belt is, the total socio-economic contributions and payments amounted to 467 million.” “If you follow the foundational wisdom and thinking from monetary authorities, which I am an alumni of, the money released from wages and other payments, this is the velocity of money that they talk about, the circulation of money. The contribution in provincial areas is 3 to 4 times. In Metro cities, the circulation of money is 11 times. So when they talk of the mining industry contributing 70 billion, that is really a contribution of at least 300 billion. And that a truism that you check with the Central Bank.” Mr Alcantara states that they believe that mining is a force for good and that overall, the industry contribute significantly to the upliftment of the socio-economic lives of the people in their host communities, where before there were none. “In our communities, we have provided education from nursery to high school levels, built clinics and healthcare facilities, initiated livelihood projects and created jobs, extended scholarships that allow the college education for our indigenous brothers and sisters. Taxes that allowed our LGUs to build roads and bridges and constructed much needed hospitals to give emergency and primary healthcare services. We are the only business where we are mandated to contribute 1.5% of our operating cost [directly] to our host communities for poverty alleviation.” He also noted that they, the member companies of PNIA, are doing a great job in the environmental programs and that in fact, they do beyond compliance.Why is nickel one of the leading minerals in the industry? From PNIA’s report, nickel is one of the most versatile minerals on earth that is so powerful that it plays a vital role in the development of various industries. It is used in healthcare, agriculture, and communication. Nickel is all around us. How does mining in Philippine context shape up? From a video presentation by PNIA, it states, “Massive advances in technology have transformed and improved the mining productivity over the years giving birth to safer, more efficient and more sustainable techniques. Philippine nickel mines use contour mining method where the process of benching is adopted to properly patch or extend the slope, hence the term contour mining, because it follows the slopes of the mountains by making benches for access in mining. With this type of surface mining, the ore extracted is closer to the surface ranger from only 3 – 25 meters below the ground.” In order to limit its side-effects on the environment, their method systematically removes a thin layer of overburdened or top soil to extract the desired deposit.However, despite all these systematic methods and well-regulated mining practices, there are still endless concerns about their long-term effects on the environment. How then can we make mining environmentally sustainable? The answer is, environmental rehabilitation and reforestation.After the speech and presentation by Mr Alcantara, a panel discussion took place with Clarence T. Pimentel, Jr., Chairman Emeritus of PNIA and President/CEO of CTPCMC; Ferdinand Pallera, President, Citinickel Mines and Development Corp.; Engr. Cesar F. Simbular, Jr. President, DMCI Mining Corp.; Tulsidas Consunji-Reyes, Vice President for Marketing, DMCI Mining; and Antonio L. Co, President, Carrascal Nickel Corporation.About Philippine Mining Club:Running for 8 years now, the Philippine Mining Club is closely affiliated wiht the Melborne Mining Club. The group was formed to create better relationships across all areas of the mining industry whose aim is to uphold a professional networking environment in promoting the exploration, extraction and minerals industry of the country.

Mining

Philippine Resources - March 12, 2019

Strategic Synergies at the Mining Philippines 2018

By Marcelle P. VillegasMining Philippines 2018 International Conference and Exhibition was held last 18-20 September 2018 at the Sofitel Philippine Plaza Manila. It was a three-day event organised by the Chamber of Mines of the Philippines (CoMP) with the theme “Strategic Synergies: Communicating the Gains of Responsible Mining”. The mining summit aims to give emphasis to the many innovations, technologies, and interventions undertaken by the mining industry which is often unknown to most people. The event also focuses on the environmental programs for local communities, best practices in mining, and the Chamber’s communication strategies in addressing the rampant misconception about the mining industry.The Chamber of Mines of the Philippines is a professional association of the country’s largest mining, quarrying and mineral processing companies. The Chamber was established with an objective to promote the responsible exploration, development, and utilization of minerals. Day 1 of the event had a lively start when the General Headquarters Band of the Armed Forces of the Philippines led the Philippine National Anthem. This was followed by their upbeat music lineup starting off with Glenn Miller’s 1939 hit “In the Mood” and then a medley of songs that pays tribute to the rock legend, Freddie Mercury of the band “Queen”. Mr Gerard H. Brimo, the Chairman of the Chamber of Mines of the Philippines and CEO of Nickel Asia Corporation covered various important topics about the industry in his opening speech. Regarding the landslide in Benguet in September that was triggered by Typhoon Ompong and killed many small-scale miners, he said, "It did not take long for our detractors to point fingers at the mining industry in general, and that is one problem we have been experiencing over the years -- the lack of distinction between small-scale and the formal large-scale mining industry.”He states, “As we grieve for the small-scale miners and their families over the tragedy, we must go on record that we in this room, are not connected with small-scale activities in any way, and we have done so yesterday in the media… I believe we should also go on record that we are not against small-scale mining. They do have a role to play and it is a valid occupation, but the activity has to be done legally and with proper supervision."Mr Brimo also gave recognition to two members of the Chamber who won awards during the First Asean Mineral Awards (AMA), namely Oceanagold’s Didipio gold-copper mine for “Best Practices in Sustainable Resource Development in Mineral Processing” [1] and Nickel Asia Corporation’s Rio Tuba for “Best Practices in Sustainable Mineral Development Award” in the Mineral Mining Category. "Imagine that, amidst all the criticisms, the best mine and the best plant in the Asean region is right here in the Philippines, voted no less by the various Asean mining ministers," said Mr Brimo. "While we continue with the struggle, your participation in the Chamber activities by your membership and through conferences such as these, is much appreciated and we thank you."During a short break period, Mr Brimo had a quick interview by the members of the press. One of the topics discussed was regarding the House Bill 7951 or the Mining Tax Reform Bill filed by Rep. Estrelita B. Suansing of the First District of Nueva Ecija province last July 24. [2] Mr Brimo emphasized that the Philippines is at risk of losing investments in the mining sector if Congress passes the proposed law that will impose a 5% tax on all its metal and nonmetal mines, regardless if they were declared as mineral reservations or not. The HB 7951 could make mining companies suffer and overall, the country could lose quality investments which could affect around 100,000 families who are dependent on the mining industry.Mr Melo Acuna, journalist and radio broadcaster, asked the question, “What is the impact of the President's statements about mining and how will it impact on your investment and your partners?” Mr Brimo replied, “We're concerned particularly with the Mining Tax Bill that has been filed recently in Congress… We've analyzed it and what we've done is we've compared that mining tax structure with the very large mining countries like Chile, Peru, South Africa, Canada and Australia. The way to figure out if the tax structure is expensive or not, or fair, is to do comparisons. So we know the exact tax structures of mining in very big mining countries and we have made a comparison. And that bill puts us more expensive than the five very large mining countries that we have done comparative study on.”He describes the proposed law as, “punishing”. “We are talking to the legislator to see what can be done about it, because you can't expect investors to come here under that tax structure, but it's actually more than that. You put in an additional 5% royalty on gross revenues, and we in the nickel space, most of the nickel mines are already in mineral reservations, so a lot of us are paying that 5%. But copper and gold is a different thing. They have never been under mineral reservation. Prices are low. Everybody thinks they're making a lot of money but the reality is they're not. In fact, one of them is losing money and has lost money for the last two years. So, you introduce an additional 5% royalty to the tax structure and you run the risk of those mines closing down, and these are big mines. These are copper and gold mines, bigger than nickel. One of them in particular has a community of 20,000 people. So you can imagine the closure of one of those mines and the impact on the area if that happens.”Mr Brimo stressed that this proposed tax structure will be a problem for new projects. “If that bill passes, we are not going to see investments in our mineral sector anymore from quality companies. We want to attract in this country quality companies. Companies that are large, that are technically knowledgeable, that have a lot of resources, and that can do things properly. And they operate all over the world, so they know what they're doing. They do things very carefully. But they will not come here with a tax structure that is too expensive.”Therefore, with this possible forecast, how much investment do we expect to lose if this law pushes through? “There are three large copper and gold developments that are pending. I don't have the figures for one of them, but we're talking in the billions of pesos of lost investment, lost taxes, more importantly, employment and social development and that is critical.”Referring to first-class municipalities such as Claver in Surigao del Norte, Cantilan in Surigao del Sur, Toledo City in Cebu, and others, “What a formal large-scale mining industry does is that it develops entire areas in the countryside… You will see the development that takes place there. It is huge. These municipalities are all first class. And why are they first class? It's because of the mining industry that's there. And you will lose all that down the road. And for a country that is as blessed like us with mineral resources that would be a shame. I don't know of any mineralised country that does not encourage a vibrant mining industry to develop their natural resources. And we might just very possibly be the first, and that would be a shame, because we need exports, we need employment, we need countryside development.”Additionally, Mr Brimo also shared his insight about how taxes should be done in mining. “If you study the tax structure of these other mining countries, most of their mining taxes are on profits. They're not on revenues and that's the right way to do it because it is progressive. In other words, the more money you make, the higher your operating margin, [and] the higher the special mining tax rate [will be]. In our country, we do it in the reverse. We're very high in terms of the imposition of revenues and it's not geared towards the profits. And that is very evident in our studies and we've shared that with the DENR, MGB and DOF as well, and we continued to do dialogue with them to see where we can all end up here.”References:[1] Didipio Mine Wins Asean Mineral Awards – retrieved from the website of Mines and Geosciences Bureau [2] Gomez, Eireene Jairee. (20 Sept. 2018). The Manila Times. “PH to lose investments under mining bill – mining chamber”. https://www.manilatimes.net/ph-to-lose-investments-under-mining-bill-mining-chamber/443089/

Mining

Philippine Resources - March 12, 2019

Sec. Cimatu on “Reinventing Mining”

By Marcelle P. VillegasIn terms of taxes, fees and other charges of the Government to mining companies, how much are mining companies really contributing to the country? How much funds are mining companies giving to local communities through their social development programs? And moreover, at the present time, how may trees have mining companies planted on the land area that they have mined and rehabilitated? With all the negative media and misinformation about the industry where most people think that the mining industry is not contributing much in this country, DENR Secretary Roy A. Cimatu addressed these issues during his speech at the Mining Philippines 2018 last 18 September 2018 at Sofitel Philippine Plaza Hotel. Additionally, the Secretary emphasized the mechanics of “reinventing mining” for the benefit of people where they can utilize the mineral resources of the country. On Day 1 of the mining summit, Secretary Cimatu was in Baguio to attend to the problems relating to the landslide brought about by typhoon Ompong. On his behalf, Environment Undersecretary Analiza A. Rebuelta-Teh read his speech. The Secretary attended on Day 2 of Mining Philippines 2018.Mining Philippines Conference and Exhibition is an annual event that is organised by the Chamber of Mines of the Philippines. The event is a venue that showcase the achievements and best practices of mining companies. The participants also discuss current relevant topics that surround the mining industry. This year’s theme is “Strategic Synergies: Communicating the Gains of Responsible Mining”.Here is Sec. Cimatu’s speech during the Opening Session of Mining Philippines 2018.“To the members of the board of trustees of the Chamber of Mines headed by its Chairman, Mr Gerard Brimo, and also to the mine officers of the Chamber, Ambassador Delia Albert, Ambassador Martin Slabber from South Africa, Ambassador Win Naing of Myanmar, Ambassador Lý Quôc Tuân from Vietnam, and Canadian Trade Commissioner Crista McInnis, the Australian Senior Trade Commissioner Elodie Journet, and of course colleagues from the government and especially MGB Director Moncano and Assistant Director Uykieng. “To all the guests and participants to the mining summit, a pleasant morning. During the last forum on mining which the DENR convinced regularly as a venue to address with the mining companies the various issues confronting the industry, I mentioned about the need to reinvent mining as pronounced by the President. Why reinvent? Why not regaining and rebuilding as we call our rehabilitation efforts in Boracay? Why not reforming mining? “Reinvent means to change something so much that it appears to be entirely new. It means to take up a very different way of life. So why reinvent mining? Because that is what exactly the industry needs now. We need to change to be almost entirely new. We need to take up a very different way of life.“That is the only way to go if we are to preserve the industry’s gains in promoting sustainable mineral resources development. So how do we intend to reinvent mining? When I say “we”, not just “we”, the National Government. “We” includes the mining companies, the local government units and other stakeholders. Let us look first at where the mining industry is now.“According to reports the total Philippine metallic mineral production value advanced by 4% as of June 2018, from 52.42 billion pesos to 54.57 billion pesos year on year, or an increase of 2.14 billion pesos. The positive trend was brought about with the improved metal prices in the world market. In terms of gross value added, mining contributed 53 billion pesos during the first half of 2018. Mineral exports during the first quarter reached 1.1 billion dollars. Total employment during the same period totalled 215,000 workers. In terms of royalties, fees and other charges collected by the government from mining operations, a total of 644.4 million pesos was recorded with additional 292.6 million pesos in taxes, fees and charges collected by local government units from mining. As of July this year, the mining industry committed a total fund of 16.42 billion pesos for social development programs benefiting 966 barangays affected by mining operations.“In terms of environmental protection and enhancement programs, the amount committed reached 18.39 billion pesos and another 2.55 billion pesos for final mine rehabilitation and the commissioning programs. Under the Mining Forest Program 107 mining companies reported that they have planted 26,023.62 hectares of trees numbering 28,349,833.“So can we say, not that bad? Or maybe we should say we can do more or even better we should do more. And when we say that we should do more, we are reinventing mining. We are changing the industry’s way of life. Is the government on the other hand providing the enabling policy environment to support the growth of mining industry with high regard to environmental considerations? There are several policy issuances that I have signed as initial efforts to reinvent mining.“DENR Administrative Order 2018-13 Lifting the Moratorium on the Acceptance, Processing and Approval of Applications for Exploration Permit for Metallic and Non-metallic Minerals following the completion of the audit on all mining operations pursuant to DENR Memorandum Order 2016-01 or the Audit of All Operating Mines and Moratorium on New Mining Projects.“Administrative Order No. 2018-19 or The Guidelines for Additional Environmental Measures for Operating Surface Metallic Mines was issued to provide new environmental policies that will ensure sustainable environmental conditions at every stage of the mining operation and minimize the disturbed area of a mining project at any given time. “Administrative Order No. 2018-20 or Providing for a New Guidelines in the Evaluation and Approval of the Three-year Development/Utilization Work Program provides standards in the evaluation and approval of the said program that is consistent with the approved feasibility study, the provisions of mining laws, rules and regulations, and the terms and conditions of the mining permit and contract. The new guideline was also designed to provide for an efficient monitoring system of operating mines. The review conducted by the Mining Industry Coordinating Council or the MICC technical review teams showed that mining industry really needs to shape up as a sector.“Even if there are responsible mining companies, those which still disregard environmental laws unfortunately affect not just the overall image of the sector but also provides an impression of this malperformance of this industry in general.“The reviews specified major reforms needed. For example, on adequate mine tailings pond and the very slow rehabilitation of the disturbed mined areas. It also pointed out unacceptable practices regarding stock pile areas, location of tailing storage facilities, and dumping of toxic and hazardous waste. I believe that enforcement is critical to usher in a new era of doing mining in the country. Reinventing mining entails improving the MGB monitoring of operations and compliance of mining companies to mining and environmental laws, rules and regulations; enforcing fines, penalties, suspension and closure to demonstrate no-nonsense, putting-into-force compliance and promoting deterrence for commission of violations is imperative. Most importantly, reinventing mining in the Philippines is providing actual benefits to the people, who must benefit first and foremost from the utilization of the country’s mineral resources as pronounced by the President in several instances.“We can do more not by imposing additional taxes, or giving incentives, or implementing social development programs. We can do more by strictly complying with the protection and conservation of the natural resources to ensure that future generation will benefit. So let us continue undertaking reforestation programs as a mining sector. Let us implement progressive rehabilitation in our mining areas. Let us provide appropriate mitigating measures to protect our watershed and water bodies. But most of all, let us follow strictly the environmental guidelines in all aspects of mining operation.“As the scheduled re-opening of Boracay gets near, we will be able to demonstrate that effective enforcement and coordination among concerned agencies and stakeholders can lead to successful rehabilitation and improve environmental quality.“As a military man, I have received several commendations that anyone could be proud of, but the truth is, the things that we have done and accomplished to make Boracay “cessful no more” gives me more satisfaction than any military award that I have received, maybe because I know I am doing something for the environment, for our children’s future and our children’s children’s future. And now the challenge is for us all to work together to make something that we will all be proud of and satisfied. We should do more. We can change mining’s way of life. Let us change the face of mining in the Philippines, a sector that is capable to discipline itself, that has high regard for the environmental protection, one that works genuinely with the communities.“I would like to congratulate the Chamber of Mines of the Philippines and its partners in organizing this mining summit. As we engage each other in sharing experiences in discussing policy issues and recommendations, in just by getting to know more each other, we are undertaking efforts to unite the industry towards our common goal, sustainable development of our resources, economic upliftment of the people, and progress for our country. Maraming salamat po at mabuhay!”

Mining

Philippine Resources - March 12, 2019

Acid rock drainage management at Masbate Gold Project

By Marcelle P. VillegasFilminera Resources Corp. is a company involved in mining and quarrying of gold, silver, nickel, copper and chromite. Masbate Gold Mine was acquired in an acquisition in January 2013. It was in April 2010 when exploration drilling began. The mine site is located in Aroroy, Masbate (Region V) which is around 350km south of Manila. The mine site is a brownfield, an open-pit mine, and is a major gold producer in the Philippines. [1]Gold processing in a mine site could result into environmental issues if not managed properly. In the case of Masbate Gold Project, how do they manage the Acid Rock Discharge from the site?During the MinECon 2018 in Surigao City last June and the PMEA Monthly Membership Meeting last September, Engr. Elvira Pelleja- Acleta, Senior Mine Engineer of Filminera Resources Corp. presented the topic “Acid Rock Drainage Management at Masbate Gold Project”. Her technical presentation addressed various issues like environmental protection and rehabilitation in their gold mine project. “Acid Rock Drainage or ARD is the discharge of acidic water from the mine. It may come from the active pit or from dumps and stockpiles as a result of oxidation of sulphide minerals, predominantly Pyrite (FeS2).” [2]The chemical equation goes:Pyrite + Oxygen + Water = Iron hydroxide + Sulphuric acid FeS2 + O2 + H2O = Fe(OH)3 + H2SO4 (exothermic) This processing stage produces acid, salinity (in the form of sulphate, calcium, magnesium mainly), dissolved metals (iron, aluminum, and can also contain elements such as As, Cd, Cu, Mn, Pb, Se, Zn etc. and other trace metals based on mineralogy). The contact water can be acid or metallifeorus. It may also be neutral, alkaline and saline, depending on the balance of oxidation or neutralisation reactions. Carbonate minerals and silicates act as buffer for the acidity, thus maintaining elevated pH and low metal concentrations.Why is ARD a potential environmental hazard? According to her report, ARD is one of the key issues of the Mining Industry due to its potential for water contamination, possible damage to flora and fauna, and human health hazards when it contaminates drinking water, food crops and fish stocks. Additionally, ARD can increase soil erosion and dump stability issues, increase cost for closure, long-term liability and possible negative company reputation.The good news is, for the record, in prior years, they avoided mining potential acidic areas. In 2015, they have done preliminary studies with Environmental Geochemistry International (EGi). By 2016, more results came out and ARD awareness spread to the mining groups and other departments and contractors. Further studies were done in 2017 to determine criteria for segregation, instrumentation and monitoring commence cover design studies. This year, more site supporting, instrumentation, cover design completion and monitoring are executed. The objective of Masbate Gold Project is to create a Management Plan for ARD that is science-based, financially viable, globally acceptable using international standards and practices, compliant to local regulations, and the approach is preventive rather than reactive.In order to reach the objective, key programs are established and applied on the site namely:- Geochemical Testing - for classifying Potential Acid Forming (PAF) and Non Acid Forming (NAF) Waste Rocks- PAF/NAF Delineation and Modelling- Integrate Segregation Criteria into Mine Planning and Operations- Dump Cover Systems to ensure long term control of ARD- Oxygen and Surface Water Quality Monitoring Programs to ensure detection of ARD effects- Drilling campaign on existing Waste Rock Dumps - Continuous collaboration with EGi provides specialized services in mine waste geochemistry and mine waste managementGeochemical Testing and Leaching provides a scientific approach in identifying Potential Acid Forming (PAF) versus Non-Acid Forming (NAF) waste rocks. It is important to identify PAF vs NAF because the results are used for the PAF/NAF modelling and blocking. These models are produced by Leapfrog Software. Using Geovia Surpac, a software specializing in geology and mine planning, PAF/NAF are blocked together with High Grade and Low Grade Ore to produce dig blocks. The software provides information for material scheduling and selective handling. The next stage is integration into planning and operation where actual dig blocks are marked on the ground using flagging tapes. Ore spotter will now guide the Excavator and Truck Operators on material loaded and its destination. This prompts review of dumping strategy and monitoring.Dump Cover Systems are used to control oxygen advection/diffusion and infiltration. The system must also have the capability to neutralise by encapsulation (NAF outside/PAF inside).Following this is the rehabilitation of the final lift using with Compacted Barrier with Vegetation. Rehabilitation along the slopes minimizes erosion and water infiltration via evapotranspiration.References:[1] https://www.mining-technology.com/projects/cga-mining/[2] Elvira Pelleja-Acleta, Genn Russell Abad. “Acid Rock Drainage Management at Masbate Gold Project”

Mining

Philippine Resources - February 22, 2019

China’s commodity consumption influencing metal prices

As the largest consumer of metals, China dominates the global supply and demand of metals, and Asia is at the very centre of the debate on the future of the international mining industry.Urbanisation continues to increase across the continent, with new housing and increased wealth triggering higher consumption of copper and steel in particular. Asia is also at the centre of the emerging market for electric vehicles. This will drive demand for batteries and their important major constituent metals of cobalt, copper and nickel, plus graphite, lithium and manganese.The developing nations of South East Asia, especially the booming economies of Vietnam, Indonesia and the Philippines, have become important participants in the global supply and demand of metals. In addition to the region’s burgeoning consumption, these nations are also seeing sharply higher metals output with, for example, crude steel production in the region, outside of China, expected to grow at an annualised rate of 14%.With many metals declining in value last year, the battery metals have been amongst the better-performing extracted commodities recently. Cobalt averaged US$25.32/lb in 2017 and US$33.08 in 2018, nickel US$4.88/lb and US$6.12, and copper US$2.81/lb and US$2.93, respectively. These important metals are expected to hold their value this year; according to S&P Global Market Intelligence, the consensus amongst analysts at the end of 2018 for average prices this year was US$33.48/lb for cobalt, US$2.99/lb for copper and US$6.32/lb for nickel.These forecasted price increases make Hong Kong, one of Asia’s key financial centres, the ideal location for the Mines and Money Asia conference and exhibition, which will welcome over 500 investors to compare projects across the commodity spectrum.Indonesian copper projects Merdeka Copper Gold and Asiamet Resources are among the 80 participating mining companies looking to meet new investors. Cobalt and nickel explorer, Deep Green, and graphite developer, Ceylon Graphite will also be in attendance.Over 150 mining and investment leaders will come together from 2-4 April 2019 to discuss the global mining investment landscape, China’s commodity consumption and the political and macroeconomic influences on the price of base, precious, bulk and battery metals.About: Mines and Money Asia is Asia’s largest mining investment forum, now in its 12th year, it has helped to generate billions of dollars in new business deals and opportunities and helped to finance hundreds of junior miners. Over 1500 key global decision makers, mining executives, investors, commodity buyers and policy makers from over 40 countries will converge in Hong Kong from 2-4 April for three days of learning, deal making and unparalleled networking.https://asia.minesandmoney.com/

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