Mining or Food? Case Study 2: Copper and Gold Mining Zamboanga del Norte - Mindanao Island

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PhilippinesPhilippinesPhilippinesPhilippines


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Philippines: Mining or Food?Case Study 2: Copper and Gold Mining

Zamboanga del Norte - Mindanao Island

by

Robert Goodland and Clive Wicks

for

The Working Group on Mining in the Philippines

Sustainable development is development that meets the needs of the present

without compromising the ability of future generations to meet their own

needsThe Brundtland Report, Our Common Future,

UN World Commission on Environment and Development, 1987

In a world overflowing with riches, it is an outrageous scandal that more than

826 million people suffer hunger and malnutrition and that every year over 36million die of starvation and related causes. We must take urgent action now.

Jean ZieglerUN Special Rapporteur on the Right to Food, April 2001

Disclaimer

The views expressed in this report are those of the authors and not necessarily thoseof the participating or supporting organizations. The authors have, however, donetheir utmost to reflect the views of the many people they met in the Philippines andthe views and reports of the people and organizations who have commented on earlierdrafts if this report.

DEDICATION

The Working Group on Mining in the Philippines and the authors respectfullydedicate this report to all the courageous and dignified people who have beenkilled while protecting the environment and upholding human rights in the

Philippine archipelago.


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Copyright Working Group on Mining in the Philippines 2008

First Published in 2008 by the Working Group on Mining in the Philippines,28 Redington Road, London, NW3 7RB, United [email protected]

ISBN Number: 978-0-9560616-0-7

Report authors: Robert Goodland and Clive Wicks

Report editors: Cathal Doyle, Ellen Teague, Sarah Sexton and Frank Nally.

Report layout and cover design Frank Nally and Cathal Doyle

Front Cover Photos:-Placer Dome Marcopper Mine Marinduque Island by Dr Catherine Coumans,MiningWatch, Canada;- Rice fields on Authors Field Trip to Midsalip


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The Working Group on Mining in the Philippines

The Working Group on Mining in the Philippines was established in 2007, after thepublication in January that year of the report, Mining in the Philippines: Concernsand Conflicts. Based in Britain and chaired by the Right Honorable Clare Short MP,

UKs former Minister of International Development it includes representatives fromthe Columban Missionary Society, the Ecumenical Council for CorporateResponsibility, Philippine Indigenous Peoples Links and IUCN- CEESP.

The Authors

Robert Goodland is an environmental scientist specializing in economicdevelopment. He advised the World Bank Group from 1978 through 2001. He thenbecame the technical director to H.E. Dr. Emil Salims independent ExtractiveIndustry Review (http://www.ifc.org/eir) of the World Bank Groups portfolio of oil,gas and mining projects. He was elected president of the International Association ofImpact Assessment, and Metropolitan Chair of the Ecological Society of America.He was awarded the World Conservation Unions Coolidge medal in October 2008.([email protected])

Clive Wicks has 48 years of experience of working in engineering, agriculture andenvironment, specializing in the impact of extractive industries on the environment.He is a vice chair of IUCN-CEESP (IUCNs Commission on Environmental,Economic and Social Policy) and co-chairs SEAPRISE (IUCN-CEESPs WorkingGroup on the Social and Environmental Accountability of the Private Sector). Heworked in the international environmental movement for the last 24 years, mainlywith WWF UK. He headed WWF UKs African, Asian and Latin Americanprograms, and represented WWF at G8, World Bank, International FinanceCorporation, UNEP and UNDP meetings on extractive industries.([email protected])


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Acknowledgements

The Authors wish to thank all those who helped them, both during their trip to thePhilippines and in the last year, for the substantial information provided to help themwith their research. This report would not have been possible without the support of

many people in all the areas visited, including Indigenous Peoples, who opened theirhearts and shared their concerns with the authors about the environmental and humanrights abuses caused by mining. They are the real authors of this report.

However, in view of the vast number of extrajudicial killings that have taken placesince 2001, now believed to be over 1,000, including a Bishop of the IndependentChurch, the authors are reluctant to name people or organisations in the Philippines.The authors admire the many other people, including lawyers, some of whom havealso lost their lives while trying to protect their people from mining industry abuses.

The authors admire the courage of the politicians, bishops, priests, sisters and pastoral

workers of the Catholic Church and the leaders of many other faiths and none andhuman rights lawyers who have the courage to speak out against the destruction thatmining is currently and will increasingly cause to their beautiful, fruitful and bio-diverse archipelago. It has been a great honour and a humbling experience for theauthors to work with such brave and committed people.

They would like to thank the Local Governments Units, the Catholic Church,especially the Columban Missionaries and the bishops, priests, sisters andcommunities who welcomed them during their trip and provided accommodation,transport and food for the team.

The best help the authors could provide was to apply their long years of experienceand professional knowledge of the extractive industry around the world and theirknowledge of environmental and human rights best practise, laws and conventionsin an impartial and professional way.

They would like to especially thank PAFID for their contribution to the mapping ofthe areas visited in their February 2008 Field Trip, LRC-KSK-Friends of the Earth fortheir expertise on the law and assisting Indigenous Peoples protect their rights,Professor Arturo Boquiren, Professor Ernesto Gonzales for their contribution andinsights about the economics of mining versus environmental value and Cathal Doyle

of the Irish Centre for Human Rights for input on the rights of indigenouspeoples.Paul K.

From The Working Group on Mining in the Philippines (WGMP):

The Working Group would like to thank Robert Goodland and Clive Wicks for theirdedication and passion for human rights and environmental justice, which has ledthem to generously give of their time and expertise to travel to the Philippines andanswer the call of an ever increasing number of communities to help them protecttheir rights, their lands, their lives and livelihoods. We wish to thank Cordaid, theHolly Hill Charitable Trust, Paul K. Feyerabend Foundation, the Columbans, the

IUCN-CEESP (Commission on Environmental Economic and Social Policy), for theirfinancial support to realise this report and maps.


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Case Study 2: Copper and Gold Mining Zamboanga del Norte - Mindanao

Island

Table of Contents

Background 94Mining damage 95Future plans? 98Sibutad and Libay Visit 99Sibutad and Libay Conclusion, Recommendation and Map 100

ANNEX: Table of Contents for Entire Report Including Case Studies 106


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Map of the Philippine Archipelago

Report and Case Studies available in individual documents at:

http://www.piplinks.org/miningorfood

MAPS associated with these 6 Case Studiesare available at http://www.piplinks.org/maps

6. SIBUYANISLAND

2. LIBAY SIBUTAD

5. MINDORO NICKELPROJECT

1. MIDSALIP

3. TAMPAKANSAGITTARIUS

COPPER & GOLD

4. MATI DAVAOORIENTAL PUJADA

BAY

CCaassee SSttuuddyy LLooccaattiioonnss


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Provincial Map of the Philippines1

1 Source Wikipedia


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Case Study 2: Copper and Gold Mining Zamboanga del

Norte - Mindanao Island

Background2

The barangay (village) of Libay is located on the coast ofSibutad3 in Zamboanga del Norte, one of the provinces in theZamboanga Peninsula in northwestern Mindanao. It is apicturesque area with lush vegetation and rolling hillscovered in forest. At the foot of the hills are rice fields,homes, and Murcielagos Bay,4 which contains coral,mangroves and important fishing grounds. It is one of themost fertile areas of the Philippines, exporting commodities

to the mainland.Bishop Jose Manguiran DD

Mineral deposits in the province of Zamboanga del Norte include chromite, gold,bentonite, marble, limestone, quartz, pebbles and gravel. According to the website ofPhilex Mining, Sibutad has measured reserves of 17.6 million metric tonnes of orecontaining an estimated 0.84 grammes of gold per tonne.

Libay is at the center of Philex Mining operations and is the home base of small-scaleminers. Before Philexs arrival, local people remember that their seashore was soclear: fish and seashells were found in abundance; fishermen never experienced foul

odours from the mountain that they believe to be from poisonous chemicals; peopledid not experience drinking water shortages, or fear poison in their water. The farmerswere able to fully utilize the potential of vast tracts of rice fields. Some people alsoengaged in small-scale mining to augment their income; peoples capacity for buyingincreased, which led to more small businesses, especially food stores.

Philex Gold Inc., which operates, develops and explores gold projects in thePhilippines, was created in 1996 as a spin-off from the gold assets of Philex MiningCorporation, a Philippine-based company that had been operating in the country foraround 40 years. It ran the Bulawan gold mine in Negros Island, and Sibutad, itssecond mine, was billed to begin production in 1997. In its first year of existence,

Philex Gold claimed to have become the largest primary gold producer in thePhilippines with an aggressive exploration and acquisition program. Philex Gold was81.8% owned by Philex Mining Corporation; it was listed on the Toronto Stock

2 Much of this section is derived from:http://www.minesandcommunities.org//search.php?words=Libaywww.minesandcommunities.org/company/philex1.htm ; Tito Natividad Fiel, Program CoordinatorDIOPIM Committee on Mining Issues G/F, Diocesan Pastoral Center, Sicayab, Dipolog City (2006),and from Patenaude (1999).

3 http://sibutad.zamboangadelnorte.com/ and http://www.maplandia.com/philippines/region-

9/zamboanga-del-norte/sibutad/

4 http://www.dcmiphil.org/Bye-bye_Murcielagos_Bay.pdf


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Exchange5 on 28th October 1996 under the trading symbol PGI and raised $23 millionfor its Philippine operations through its initial public offering.6

Mining damage

In contrast to some of the other areas visited during the authors field visits, Sibutad isan example of gold and copper mining that caused such destruction in the 1990s andearly 2000s that the government departments were eventually forced to suspend thepermits. Nonetheless, the damage remains, and there are fears that the mining maystart up again.

The problems started in 1995 when the machinery of Philex Gold arrived in Sibutad.Philex began constructing diversion roads in Sibutad before the Department of theEnvironment and Natural Resources (DENR) had granted the company a permit to doso. Materials excavated from the diversion road were dumped down the hillside,rather than being stockpiled according to mining legislation. Sedimentation from theexcavated materials clogged small creeks, from where it spread into rice paddies, andthen began to accumulate along the coastline. Community protests over the massiveearth-moving and resulting sedimentation into Murcielagos Bay did not stop Philexfrom continuing its operations.

The DENR initially rejected Philexs Environmental Impact Assessment (EIA) andtold the company to upgrade it. In January 1997, however, it granted Philex anEnvironmental Compliance Certificate (ECC), and then, in April 1997, its applicationfor a Mineral Production Sharing Agreement (MPSA) for 3,888 hectares in LablabThe town boomed almost immediately: its population soared to over 10,000, the

market for fish rocketed, employment soared and supply stores flourished as didprostitution, child labor, disease, gambling and violence.7

Siltation and sedimentationIt was not long, however, before the direct impacts of the copper and gold miningbecame apparent. At the end of October 1997, Philexs Chair and Chief ExecutiveOfficer Gerard Brim boasted that the companys silt barriers were strong enough towithstand six months of torrential rains. One week after this boast, on 6th November1997, a flash flood led to a mudslide caused by the failure of one of Philexs siltdams. This was after just two hours of heavy rains. This torrential mud inundatedagricultural lands and irrigated rice fields, and destroyed five homes.

5 http://www.tsx.com/

6 The original sale of a companys securities, in which the proceeds from the sale are received directlyby the company.

7 In 1995, the Department of Labor and Employment (DOLE) study reported 114 child laborers insmall scale mining (see Norman Jennings ed. 2000.) Child labor in small-scale mining: Examples fromNiger, Peru & Philippines, ILO.

http://www.ilo.org/public/english/dialogue/sector/papers/childmin/137e3.htm

Department of Labor and Employment, Region 9, Zamboanga: A study of the incidence of child labor in Sibutad municipality, 1996. Footnote 26http://www.ilo.org/public/english/dialogue/sector/papers/childmin/137en.htm#N_26_


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This was just the beginning. Between 1997 and 2002, overflows from Philexs tailingsdams repeatedly affected the immediate surroundings, causing mudslides thatcontinued to destroy rice fields, silt the bay (reaching 200 meters out to sea), anddamage mangroves, which resulted in rice production falling by half and massive fishkills (Bautista 2008).

Heavy sedimentation of MurcielagosBay8 disrupted the ecological balance sothat marine life became weak anddiseased or simply died. Fishing-dependent communities lost theirprimary source of livelihood that thebay once provided in abundance,especially fish, shellfish, and seaweed.They complained to governmentagencies on several occasions about the

pollution of the Bay, the destruction oftheir agricultural lands and the loss ofdrinking water..

DENR eventually found Philexresponsible for the damage, not incompliance with mandated precautions,and lacking the necessary permits.Despite these findings of recklesslaxity, DENR did not penalize Philex,nor order it to suspend operations tostabilize the area so as to prevent furtherdamage to agriculture, fisheries andproperty (DENR 1997a.b.c.). Instead,DENR ordered Philex to create amonitoring team as part of itsEnvironmental Compliance which thecompany refused to do. The impactedpeople and their advocates called uponDENR to stop Philexs operationsentirely until they could be rendered

safe and the company compliant withnational regulations. But the DENRrefused to act.

Mercury Poisoning

Murcielagos Bay was affected not only by sedimentation but also by mercury andcyanide pollution from the mine spills. In September 1997, marine biologists from theUniversity of San Carlos at Cebu City, found a higher concentration of mercury in

8Bye-Bye Murcielagos Bay Bye-bye, A Case Study of Philex Gold Philippines Incorporated in Sibutad,Zamboanga del Norte by Andrea Patenaude, Originally Published in Minding Mining! Lessons from

the Philippines by the Philippine International Forum (PIF) in 1999. http://www.dcmiphil.org/Bye-bye_Murcielagos_Bay.pdf


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sediments close to where Philex mining was operating (University of San Carlos,1998).9 The DENR itself documented dangerously high levels of mercury in the Bay.Cases of Minimata Disease and other evidence of mercury poisoning of humans werereported. Another study in 2004 found that those who had been directly exposed tomercury during the gold processing had significantly higher mercury and

methylmercury levels in their blood compared with those people who were indirectlyexposed.10

Philexs major excavations were informerly artisanal miners areas,and thus may have opened upmercury-laced residues fromprevious mining. Small-scale goldmining activities using mercuryhad begun in the late 1980s inSibutad, near to the Murcielagos

Bay. In addition, Philex boughtand re-processed mercury-richbags of tailings from artisanalminers. Violence between Philexand artisanal miners resulted inPhilex security guards killingCrelim Cadalin, a small-scaleminer, in May 1998 when he wastrying to access his small-scaletunnel while trespassing onPhilexs site. Philexsenvironmental director labeled thiskilling as a typical incident blownout of proportion.

Cyanide Contamination

Philex did acknowledge using the cyanide heap-leach method to separate gold fromresidues. The Cyanide Detection Test (CDT) Laboratory Network of the Bureau ofFisheries and Aquatic Resources tested Philex waters on 24th February 1999, and

found them positive for the presence of cyanide.

11

Moreover, they found all the main

9 Potential impacts of the Lablab mine not only affect Libay but the surrounding bay and marinereserves to the south. Many impacts may continue to accrue to the surrounding areas and to thesouthern province of Misamis Occidental, which has 169 km of coastline fronting the rich fishinggrounds of Panguil Bay on one side and Iligan bay on the other (Fide: Science of the TotalEnvironment 354). Some forest remains on some peaks; there are brackish-water fishponds in theregion.

10 Nelia Cortes-Maramba et al, Health and environmental assessment of mercury exposure in a goldmining community in Western Mindanao, Philippines, Journal of Environmental Management, Vol.81, Issue 2, October 2006, pp.126-134.

11 The cyanide detection test was certified true and correct by Melessa G. Melchor, CDT Chemist, andnoted by Benita E. Manipula, Assistant Laboratory Director.


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fish species to be contaminated with cyanide.Philex reportedly contracted another miningcompany, BHP, to carry out an EnvironmentalImpact Statement in 1999, but it was not madeavailable to the Government (University of San

Carlos 1998).

In 2002, however, DENR finally suspended themining operations of Philex. Nonetheless, localsreport that the company is continuing withsmall-scale mining within the site usingmechanized equipment. At least 90% of the orewas still remaining when the mine was closed.

Future plans?

The official reason Philex gave for suspending its mining operations was the lowprice of gold at the time; there was also speculation that it did not have enoughresources to continue mining at their previous levels. Gold and silver dor bullionbars were shipped for sale to the UK, Germany and Singapore.

During the current world financial crisis, more investors may shift to precious metals,raising the price of gold. Whether that leads to more financing for gold miningremains to be seen. In Sibutad, however, Philex employees have been seen talking tobarangay (village) leaders, and many communities fear that mining will expand.

Their fears have been exacerbated by the interest of mining corporation

FreeportMcMoRan in Philex. On 19

th

March 2007, Freeport-McMoRan acquired USmining company Phleps Dodge for US$13.9 billion and 136.9 million stocks andshares to become the worlds largest publicly traded copper mining company. As aresult of the takeover, Phelps Dodge became Freeport McMoRan Copper & Gold,Inc., which owns 40% of Philex Gold.

On 3rd October 2007, Philex Gold announced that its wholly-owned subsidiary,Philex Gold Philippines, Inc., had signed an agreement with PDEPI (Phelps DodgeExploration Philippines. Inc.), which is an indirectly 40%-owned subsidiary ofFreeport McMoran Copper & Gold Inc. The Earn-In Agreement concerns part ofPGPIs Sibutad project tenements covering 6,954 hectares. The Property consists of

the areas covered by three permits: an Exploration Permit Application (EPA # 047-IX) covering 5,846 hectares; a Mine Production Sharing Agreement (MPSA 63-97-IX) covering 622 hectares; and an Application for Production Sharing Agreement(APSA 73 -IX) covering 486 hectares.

Philex Gold has also announced another surprise move concerning its operationselsewhere in Mindanao: a joint venture with the UK-based Anglo AmericanExploration concerning the Boyongan copper-gold porphyry deposit in the provinceof Surigao del Norte in north-eastern Mindanao which was discovered in August2000. On 25th September 2008, Anglo Philex Gold Inc. stated that Philex MiningCorporation (PMC) had approved the acquisition of Anglo American Exploration

(Philippines) BVs 50% interest over the Boyongan copper-gold porphyry propertyfor $55 million, giving Philex and its subsidiary, Philex Gold Philippines, Inc., full

We believe that the Sibutad

Claims hold great promise

or the future. Philex Gold IncAnnual Report 1996


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control over the property. PMC will apparently buy the shares currently owned byAnglo American in the joint venture companies, Silangan Mindanao MiningCompany, Inc. and Silangan Mindanao Exploration Company, Inc.; these companiesare the owners of four mining tenements, including Mineral Production SharingAgreement (MPSA) No. 149-99-XIII, which cover five parcels of land including the

Boyongan deposit.12

Many deals entered into by both local and foreign mining companies and miningmultinationals profit from exploration and mining licenses and permits and mineraldata by using them for speculative purposes rather than with a view of exploring ormining themselves.

Sibutad and Libay Visit

The authors visited Sibutad and Libay during February 2008 and met Bishop JoseManguiran who strongly opposes mining and logging because of the environmentaldamage and human rights abuses caused in his diocese, especially to the indigenousSubanen people.

They went to the Libay mining sites in Zamboanga del Norte in Mindanao and metwith small farmers and fisherfolk, who had gathered at a seminar on sustainableagriculture organized by the local communities and the Diopim13 Committee onMining Issues (DCMI)14 of the Catholic Church, which is assisting communitiesaffected by mining projects.

The team visited the area where mine spills and landslides occurred and could clearlysee the extent of the damage caused by the collapse of the tailings dam. Some

attempts had been made at erosion control by dyking and planting seedling trees, butit looked incommensurate with the need. The seedlings were not flourishing and thedykes were eroding. We also saw the Bay and coastal area, which showed signs ofreturning seagrass and mangroves. Fisherfolk reported that fish stocks were slowlyrestoring themselves since the mining was halted.

12 http://www.miningtopnews.com/philex-gold-announces-sale-by-anglo-of-50-interest-in-boyongan-project-to-philex-mining-corporation.html

13 The DIOPIM Committee on Mining Issues (DCMI) is an acronym for the dioceses headed by theBishops of Dipolog, Ipil, Ozamiz, Pagadian, Iligan and Marawi.

14 See http://www.dcmiphil.org/dcmi/index.php for The DIOPIM Committee on Mining Issues(DCMI) is a non-governmental organization (NGO) based in Dipolog City, the Philippines. The

committee is spearheaded by the Roman Catholic Church and composed of Social Action Directorswith inputs from NGOs and Indigenous Peoples groups. See also The Halifax Initiative - CanatuanPolymetallic Mine http://www.halifaxinitiative.org/index.php/miningmap/aen45a510a98928d


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Sibutad and Libay Conclusion, Recommendation and Map

The authors believe that mining in the Zamboanga Peninsula will severely damage theremaining forests and water catchment quality, increase flooding, erosion, siltation

and landslides. It will thereby reduce production of agricultural, marine resources,and bio-diversity, displace populations, re-engender conflict, and affect the humanrights of local communities, particularly the Subanen, the largest population ofindigenous people in the Philippines. Mining will increase poverty and limit theability of future generations to survive.

The authors conclude that mining is not compatible with irrigated agriculture notablyrice or fish production and is inappropriate in areas such as the Zamboanga Peninsulain western Mindanao. The authors strongly recommend that the Government bansmining in critical water catchments and prioritises the immediate protection of theenvironment including reforestation, food security and human rights including theright to a healthy environment for present and future generations.


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MINING TENEMENTS STATISTICS REPORT AS OF MARCH 2008

REGIONAL OFFICE NO. IX - ZAMBOANGA PENINSULA

III. Under Process

LIST OF MINERAL

PRODUCTION SHARING

AGREEMENTS (MPSA)

TENEME

NT ID

TENEMENT

HOLDER

DATE

FILED

LOCATION AREA

(Has)

COMMODITY REMARKS

Under Preliminary

Evaluation

1. APSA

000015-IX

*

Oreline Mining

Corporation/Ben

guet Corp./

Toquero

Geologists and

Affiliates

04-10-92 R.T.Lim, Zamboanga

Sibugay & Siocon, ZDN

4,212.00 Gold

2. APSA

000098-IX

Oreline Mng

Corp./Toquero

Geologist & Aff

29/12/19

99

RTLim,

Zambo.Sibugay;Siocon

ZDN

3,888.00 Gold, etc.

3. APSA

000017-IX

PNOC-Energy

Dev''t

Corporation

05-26-92 Alicia, ZDS 2,340.00

4. APSA

000022-IX

Emiliano

Veneracion Jr.

07-31-92 Alicia, ZDS 486.00 Gold

Pending Area Clearance /

Status

1. APSA

000082-IX

Maharlika

Dragon Mining

Corporation

09-15-97 Polanco,Kalawit&Osme

a, ZDN;Ipil,Zsibugay

7,533.00 Chromite Transfer

Order

(09-28-07)

2. APSA

000110-IX

Ester M.

Valencia

01-27-05 Brgy. Pange, Siayan,

Zamboanga del Norte

810.00 Gold, Silver, etc.

3. APSA

000111-IX

Elmo B. Valencia 01-28-05 Brgy. Pange, Siayan,

Zamboanga del Norte

1,134.00 Gold, Silver,Iron, etc.

4. APSA

000125-IX

Mt. Sinai Mng.

Explo. & Devt.

Corp.

05-24-05 Tungawan,Z.

Sibugay:Gutalac&Dapita

n, ZDN;

Suminot&Dumingag,ZDS; Vitali,ZC

10,125.00 Managanese, IronGold, Silver,

etc.

Undergoing

Revisions/Rectifications

1. APSA

000119-IX

Alberta

Resources Dev't.

Corp.

03-31-05 Sindangan, ZDN 8,100.00 Gold,Copper, Silver, etc.

2. APSA

000122-IX

MASADA

Resources &

Mng. Corp.

04-28-05 Ipilan,Salug;Pange,Siaya

n, ZDN, Balagon,

Midsalip, ZDS; Bitoon &

Dicoyong, Sidangan,

ZDN


etc.

Undergoing Publication, Posting, Radio

Announcement

1. APSA

000076-IX

Butuan Logs Inc. 08-11-97 Siraway, ZDN 3,645.00 Gold

2. APSA

000082-IX

Maharlika

Dragon Mining

Corporation

09-15-97 Polanco,Kalawit&Osme

a, ZDN;Ipil,Zsibugay

7,533.00 Chromite Transfer

Order(09-28-

07)

3. APSA

000085-IX

Maharlika

Dragon Mining

Corporation

12-16-97 Kulasihan, Tampilisan,

ZDN

810.00 Chromite Transfer

Order (09-04-

07)

4. APSA

000087-IX

BB Minerals

Corporation

04-02-98 Tipan, Pitawi,Kanapon,

Sibalic,Gutalac, ZDN

4,536.00 Chromite

5. APSA

000095-IX

Rojuman Realty

& Dev't

Corporation

04-19-99 Tigbalangao, Ligian,

Tungawan, ZDS

5,022.00 Gold

6. APSA

000100-IX

Curuan Mineral

Resources and

Dev't. Corp.

04-11-03 Brgy. Mina, Curuan,

Zamboanga City

2,430.00 Gold, Silver, etc.

7. APSA

000105-IX

Mindanao

Mining &

03-08-04 Gitalus, Midsalip &

Depore, Bayog, ZDS

7,573.00 Iron,Gold, Silver, etc.


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Mineral

Resources Corp

8. APSA

000106-IX

Edmund B.

Bilang

03-19-04 Sitio Talaptap, Brgy.

Saaz, Gutalac, ZDN

810.00 Gold, etc.

9. APSA

000112-IX

Astron

Resources

Mining Corp.

02-21-05 Brgy. Lunday &

Litawan, Zamboanga Del

Norte

4,131.00 Iron, Gold, Silver, etc.

10. APSA

000113-IX

Matatag Mining

Corp.

02-21-05 Brgy. Litawan, Dinolan

& Basakm, ZDN


11. APSA

000114-IX

31st Century

Mining Corp.

03-03-05 Brgy. Pearanda,

Kabasalan , Zambo.

Sibugay

8,100.00 Gold, etc.

12. APSA

000115-IX

Shamrock Metal

& Mineral

Processing Corp.

03-03-05 Brgy. Seroan & Seres,

Katipunan ZDN

8,100.00 Chromite, etc.

13. APSA

000117-IX

Jeffrey Andrew

L. Ocampo

03-11-05 Brgy.

Sanghanan,Kabasalan,

Zambo. Sibugay

810.00 Iron, Gold, Silver, etc.

14. APSA

000120-IX

Astron

Resources

Mining Corp.

04-06-05 Tigbucay,Tigpalay,Tunga

wan,Z.Sibugay


etc.

15. APSA

000121-IX

MASADA

Resources &Mng. Corp.

04-20-05 Longilog,Titay,Caparan,

Ipil, Z. Sibugay


etc.

16. APSA

000123-IX

Mt. Sinai Mng.

Explo. & Devt.

Corp.

05-03-05 Pange,Siayan;Bato,Sinda

ngan,ZDN


etc.

17. APSA

000127-IX

Rigid Agreggates

and Mining Corp

07-20-05 La Paz, Baluno,

Zamboanga City

1,458.00 Gold, Copper, Lead, Zinc, etc.

18. APSA

000128-IX

Greater Asia

Mininig & Dev't.

Corp.

08-02-05 Lintangan & Malayal,

Sibuco, ZDN

6,399.00 Iron., Manganese, Gold, Silver,

Etc.

19. APSA

000129-IX

Greater Asia

Mininig & Dev't.

Corp.

08-02-05 Balukbahan, Bayog, ZDS 2,673.00 Iron., Manganese, Gold, Silver,

Etc.

Published/Posted/Announced

1. APSA

000126-IX

Alberto D.

Sildlao

06-07-05 Siayan, Zamboanga Del

Norte

810.00 Chromite, Manganese, Gold, etc.

2. APSA

000036-IX

Daihan Graciano 12-23-93 Diplahan, Zamboanga

Sibugay

405.00 Gold

3. APSA

000058-IX

Jessmag, Inc. 08-01-95 Sibuco, ZDN 8,100.00 Gold

4. APSA

000073-IX

Philex Gold

Philippines Inc.

03-05-97 Rizal, ZDN 486.00 Gold

Endorsed to Central Office for Final

Evaluation

1. APSA

000104-IX

Geotechniques

and Mines Inc.

03-05-04 Midsalip, Zamboanga del

Sur

567.00 Iron, Gold, Silver,

etc.

returned/re:C

ert. Panel A.

2. APSA

000116-IX

*

Holcim Phils.

Manufacturing

Corp.

03-08-05 Brgy. Kipit,Labason &

San Juan,Gutalac ZDN

486.00 Silica Sand form. Alsons

Cement Corp.

3. APSA

000118-IX

*

A.P Tang Mning

Corp.

03-11-05 Brgys. Lumponid &

Datagan,Midsalip,ZDS

6,200.00 Iron, Gold, Silver,

etc.

form. SDV P.

Mng. Corp.

Pending NCIP Certification ICC

Consent, etc.

1. APSA

000019-IX

Maharlika

Dragon Mining

Corporation

06-29-92 Titay, Zamboanga

Sibugay,

& Labason, ZDN

10,449.00 Manganese Transfer

Order (09-04-

07)

2. APSA

000023-IX

Zamboanga Gold

Mining Corp.

09-18-92 Siocon, ZDN 2,673.00 Gold,Copper

3. APSA

000034-IX

EMACO, Inc. 12-03-93 Sibuco, ZDN 4,131.00 Bentonite Clay Return to

R.O. for re-

4. APSA

000039-IX

TVI Resource

Dev't.(Phils) Inc.

01-21-94 Siocon, ZDN 2,754.00 Copper,Silver Pendng FPIC

5. APSA

000063-IX

Mingson Agro-

Urban Dev't

Corp.

05-29-96 Labason & Liloy, ZDN 5,015.51 Silica

6. APSA

000064-IX

Roldan Dalman 11-14-96 Jose Dalman, ZDN 486.00 Copper,Gold


18/24

103

7. APSA

000074-IX

Butuan Logs,

Inc.

06-04-97 Panganuran,Sibuco, ZDN 4,832.00 Gold, etc. Revision of

loc. map

8. APSA

000075-IX

Libres and Sons

Mining & Dev't

Corp.

08-08-97 Tampilisan & Liloy, ZDN 4,941.00 Laterite

9. APSA

000086-IX

Delram Mineral

Corporation

03-06-98 Tipan, Bakong,

Mamawan, Gutalac, ZDN

1,458.00 Chromite

10. APSA

000094-IX

Juraclex Dev't.

Inc.

02-18-03 Lintangan, Pangan,

Sibuco, ZDN

3,969.00 Gold

11. APSA

000099-IX

Pola Mining

Corp.

02-21-03 Siraway, ZDN 4,131.00 Gold form.

Juraclex

Dev't. Inc.

12. APSA

000101-IX

168 Ferrum

Pacific Mining

Corp.

12-22-03 Canipay, Midsalip,

Datagan, Bayog and

Depore, ZDS

8,100.00 Iron, Gold, Silver,

etc.

formerly

Cebu Ore

Mng. & Min.

Res. Corp.

13. APSA

000103-IX

Hard Rock

Mineral Trading,

Inc.

03-04-04 Lunday, Sibuco,

Zambaonaga del Norte

and Cuatro Ojos, Vitali,

Zamboanga City


VIII. Converted to other

Tenements

TENEME

NT ID

TENEMENT

HOLDER

DATE DAT

E

LOCATION AREA COMMODITY REMARKS

FILED CONVERTED (Has.)

1. APSA

000056-IX

Philex Gold

Philippines Inc.

04-10-

95

11-

19-

04

Dapitan City, ZDN 5,565.00 Gold (converted to

EXPA)

2. APSA

000107-IX

Rigid Aggregates

Corporation

03-26-

04

05-

30-

05

Kumalarang, ZDS &

Buug, Zamboanga

Sibugay

2,430.00 Manganese,

Chromite, Iron,

etc.

(converted to

EXPA)

3. APSA

000108-IX

Rigid Aggregates

Corporation

03-26-

04

05-

30-

05

Milidan, Baliguian &

Bakong, Gutalac, ZDN

7,290.00 Manganese,

Chromite, Iron,

etc.

(converted to

EXPA)

4. APSA000124-IX

LinktoneIntl.Mng. Corp.

05-18-05

06-30-

05

Vitali,Licomo,ZC 7,776.00 Managanese,IronGold, Silver,

etc.

(converted toEXPA)

NOTE:

Mt. Kabasalan Mng. & Explo.

Co. vs

Leuk Reg Min. Res. Dev't. Corp

Gutalac, Zamboanga del

Norte

1,159.00 Chromite DENR Case

No. 8074


19/24


20/24

105


21/24

106

ANNEX Entire Report Table of Contents

Foreword to Second Mining Report viiMessage from Senator Aquilino Pimentel Jr . viiiMessage from Bishop. Zacarias C. Jimenez, DD ix

EXECUTIVE SUMMARY AND RECOMMENDATIONS xi

Summary recommendations to the Philippine Government xviSummary recommendations to Mining Corporations xxiSummary recommendations to Development Agencies, NGOs, World Bank xxiiiSummary recommendations to the Investor Community xxvSummary recommendations to Mining-Impacted Communities xxvii

INTRODUCTION 1

Chapter 1: Mining and Food Security 41.1 The Importance of Rice 41.2 The 2008 Food Price Frenzy 51.3 Peak Oil, Peak Food, Peak Phosphate, Peak Water & Peak Stable Climate 71.4 Why Does the Philippines Import Rice? 81.5 Reasons for Decreased Domestic Rice Production 9

Chapter 2: Mining and Forests 112.1 Deforestation Harms Rice and Fisheries 112.2 The Need for Watershed Conservation 132.3 Deforestation Increases Poverty 132.4 Indigenous Peoples and Forests 132.5 Rainforestation 14

Chapter 3: Mining and Marine Resources 153.1 Mining and Fisheries 153.2 Pollution From Mining 15

Chapter 4: Flawed Government Policy 184.1 Scale of the Mining Problem 184.2 Conflict of Interest 20

4.3 DENR Promotes Mining and Demotes Environment 204.4 Corruption in Environmental Governance 224.5 Philippine Mining Act, 1995 234.6 Separate Exploration from Exploitation 294.7 Post-Mining Rehabilitation Must Be Enforced 294.8 Government and Society Split on the Benefits of Mining 32

Chapter 5: Indigenous Peoples 365.1 Indigenous Peoples and the National Commission on Indigenous Peoples 365.2 The Role of the National Commission on Indigenous Peoples 375.3 Rights of Ownership and Ancestral Domain 38

5.4 Right to Develop Lands and Natural Resources 385.5 The Right to Benefits 38


22/24

107

5.6 Protections Afforded by Indigenous Peoples Rights Act 395.7 Free and Prior Informed Consent 395.8 FPIC and ESIA 415.9 Indigenous Peoples need Environmental and Social Impact Assessments 42

Chapter 6: Human Rights, Militarization and Mining 446.1 Human Rights and Mining 446.2 Official Reports Documenting Human Rights Violations 456.3 Human Rights, Civil Society and the Catholic Church 476.4 The Human Security Act 486.4 Further Militarization of Mining Projects and Investment Defense Forces 496.5 The Relationship Between DENR and NCIP 516.6 DENR Engulfs NCIP 51

Chapter 7: Philippine Mining Economics 537.1 Deficiencies in Mining Economics 53

7.2 Internalizing Currently Externalized Costs 547.3 Policy Options for Internalization 547.4 Benefit Allocation 557.5 The Resource Curse 557.6 Impact-Benefit Agreements 577.7 Assessment of Cost Externalization in Philippine Mining 597.8 Mining is the wrong Engine for Growth 61

Chapter 8: The Position of the International Agencies 708.1 The World Bank Group 708.2 International Development Assistance to DENR 72

FIELD TRIP CASE STUDIES 73

Case Study 1: Iron Ore & other Minerals, Midsalip, Zamboanga del Sur - MindanaoIsland 75Background 75Water, Food and Livelihoods 77The Threat of Mining in Midsalip 79Potential Impacts and Opposition 82Midsalip Visit 84

Midsalip Conclusion, Recommendation and Map 85

Case Study 2: Copper and Gold Mining Zamboanga del Norte - Mindanao Island 94Background 94Mining damage 95Future plans? 98Sibutad and Libay Visit 99Sibutad and Libay Conclusion, Recommendation and Map 100

Case Study 3: Copper and Gold Mining in Tampakan, South Cotabato MindanaoIsland 106

Background 106Threat of a huge open-pit copper and gold mine 108


23/24

108

Uncertainty Raising Fears 113Visit to South Cotabato 118South Cotabo Conclusion, Recommendation and Map 121

Case Study 4: Nickel and Cobalt in Davao Oriental Mindanao. The Hallmark

Project 126Background 126Proposed Mining 127Environmental and Social Impacts 129Opposition and Deficiencies in Consultation 31Visit to Pujada Bay / Mt Hamiguitan 134Pujada Bay Conclusion, Recommendation and Map 135

Case Study 5: Nickel Mining Mindoro Island 142Background 142Mining Proposal 143

Opposition 144Indigenous opposition 145Visit to Mindoro 148Company continues to plan 149Governor Issues Order to Stop Mining Activities 156Mindoro Conclusion, Recommendation and Map 161

Case Study 6: Gold and Nickel Mining - Sibuyan Island 172Background 172Forest Resources Already Threatened 173Proposed Industrial Mining 173Opposition 175Visit to Sibuyan 176Sibuyan Island Conclusion, Recommendation and Map 177

Recommendations to the Philippine Government 181Recommendations to Mining Corporations 191Recommendations to Development Agencies, NGOs & the World Bank Group 196Recommendations to the Investor Community 199Recommendations to Mining-Impacted Communities 202

Annex A: Church Declarations and Position Papers on Mining 206Annex B: Civil Society Reports on Human Rights Violations 212Annex C: Strategic Environmental Assessment (SEA) 213Annex D: Health Impact Assessment (HIA) 217Annex E: Literature Cited and Guide to Further Information 221Annex F: Mines and Communities (MAC): The London Mining Declaration. 246Annex G: Geohazards and Earthquakes in the Philippines 251Annex H: Philippine Biodiversity Conservation Priorities 260


24/24

About the Authors

Clive Wicks has 48 years of experience of working in engineering, agriculture andenvironment, specializing in the impact of extractive industries on the environment. Heis a vice chair of IUCN-CEESP (IUCNs Commission on Environmental, Economic andSocial Policy) and co-chairs SEAPRISE (IUCN-CEESPs Working Group on the Socialand Environmental Accountability of the Private Sector). He worked in the internationalenvironmental movement for the last 24 years, mainly with WWF UK. He headed WWFUKs African, Asian and Latin American programs, and represented WWF at G8, World

Bank, International Finance Corporation, UNEP and UNDP meetings on extractiveindustries. ([email protected])

.. Perhaps reluctantly we come to acknowledge that there are also scars which mark the surface of our

earth: erosion, deforestation, the squandering of the worlds mineral and ocean resources in order to fuel

an insatiable consumption. Some of you come from island nations whose very existence is threatened by

rising water levels; others from nations suffering the effects of devastating drought. Gods wondrous

creation is sometimes experienced as almost hostile to its stewards, even something dangerous. How can

what is good appear so threatening? ...My dear friends, Gods creation is one and it is good. The

concerns for non-violence, sustainable development, justice and peace, and care for our environment are

of vital importance for humanity.His Holiness Pope Benedict XVI, 23rd World Youth Day, Sydney, Australia, July 12-21, 2008

Working Group on Mining in the Philippines(WGMP)

Robert Goodland is an environmental scientist specializing in economic development.He advised the World Bank Group from 1978 through 2001. He then became the

technical director to H.E. Dr. Emil Salims independent Extractive Industry Review

(eir.org) of the World Bank Groups portfolio of oil, gas and mining projects. He waselected president of the International Association of Impact Assessment, andMetropolitan Chair of the Ecological Society of America. He was awarded the WorldConservation Unions Coolidge medal in October 2008. ([email protected])

Photos if the fact-finding trip can be found on:http://workinggrouponmininginthephilippines.blogspot.com

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Mining or Food? Case Study 2: Copper and Gold Mining Zamboanga del Norte - Mindanao Island

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