Mining loses $1.5B in potential investments

The Philippines’ mining industry remains in limbo as businessmen and potential investors await the new mining law to be passed by Congress, the Chamber of Mines of the Philippines says. AFP FILE PHOTO

The country’s mining industry remains in limbo as businessmen and potential investors await the new mining law to be passed by Congress, according to the Chamber of Mines of the Philippines.

“To go forward, the government must resolve the mining revenue-sharing issues first. That won’t happen until at least after the midterm elections in May and when a new Congress is sworn in,” Jimbo Gulle, the new spokesman of the CMOP, said in an interview.

Gulle noted that mining industry stakeholders have lost all hope that a new mining law would be approved before the close of the current 15th Congress and that the moratorium on new mining contracts would be lifted.

“There’s a six-month lull in Congress (in connection with talks about mining). We have to wait until June this year. We are patient about it but you see if the mines don’t get to work and companies are not allowed to start operations, all the investments planned for the country will not happen,” Gulle said.

Gulle cited data from the Mines and Geosciences Bureau (MGB) showing that the foreign mining investments that flowed into the country last year reached $509.24 million, 75 percent lower than the estimated $2 billion. The Philippines lost $1.5 billion worth of potential investments.

The Chamber of Mines said that with the issuance of Executive Order 79, which imposed a moratorium on mining agreements until such time that a new mining bill has been enacted into law, both government and industry leaders have reconsidered their projections for the mining industry.

The government has lowered significantly its forecasts for mining investments for the next four years because of project delays due to the implementation of EO 79.

Industry records showed that investment inflows for 2013 would likely reach $718.47 million, down from the previous target of $2.07 billion; $851.75 million in 2014 from the previous estimate of $2.4 billion; $757.6 million in 2015 from $2.9 billion; and $619.5 million in 2016 from $2.3 billion.

Gulle also cited the case of Sagittarius Mines Inc., which is developing the Tampakan copper-gold project in Mindanao, but has to put its $6-billion project on hold due to a provincial ordinance prohibiting open-pit mining.

“There should be a harmony in national and local laws. That’s something the government should solve,” he said.