Clarify mining EO’s rules, gov’t urged

The Chamber of Mines of the Philippines (COMP) said it was asking the government to clarify the implementing rules of mining reforms to “appease investors.”

In a statement, the group said it was sending a letter to the Minerals Industry Coordinating Council (MICC) to voice out its members’ concerns on the revised implementing rules and regulations (IIR) of Executive Order 79 on mining policy reforms.

“It is our objective that the laws, rules and regulations governing the minerals sector are consistent and free from ambiguity,” the group said.

COMP said it acknowledged President Aquino and the MICC for responding to concerns regarding “the unauthorized last-minute insertion made by Natural Resources Secretary Ramon Paje” in IRR.

“We are conscious of our government’s difficult duty of balancing interests. As an industry clearly viewed by the Aquino Administration as a key source of quality long-term investments, we recognize the efforts of the MICC to establish a consistent and stable business climate that fosters development as well as the integrity of the environment and the community,” COMP said.

Earlier, COMP said mining firms might sue the government for a “patently illegal” provision on contract reviews under Sec. 9 of the executive order’s IRR.

COMP president Benjamin Philip Romualdez told reporters that mining companies were “preparing legal action against the government” for the IRR provision stating that the government could renegotiate the terms of the mining contracts after the first 25 years.

This, Romualdez said, effectively shortened the potential project period from the existing maximum of 50 years.

Challenges in the mining industry—including the moratorium on new contracts pending changes in mining tax laws, local government ordinances that ban mining or methods such as open pit mining, and high investment requirement amid high political risks—were hampering the inflow of investments at a time when the government was seeking more revenues from the industry, Romualdez said.

“The moratorium has caused an outflow of foreign direct investments from our sector since 2011 to the tune of more than P10 billion,” Romualdez said.

“The projected $16 billion in investments that were supposed to materialize during this administration will not happen. The $2 billion that we were expecting in additional foreign direct investments this year from the minerals sector will not happen. The $2 billion that we expect in additional investments next year will not happen,” Romualdez said.

Section 9 of the IRR for EO 79 states that an expiring 25-year mining contract/agreement “may be renewed subject to new terms and conditions pursuant to the laws, and rules and regulations that are existing at the time of the renewal or may be hereafter issued, such as, but not limited to, the establishment of the contract area as a mineral reservation.”

Industry members said the provision contradicted Section 32 of Republic Act No. 7942, or the Mining Act of 1995. The Mining Act states that mineral agreements will have a term not exceeding 25 years, renewable for another term not exceeding 25 years under the same terms and conditions.