Communist Rebels Raid Gold Mine In Mindanao

Communist rebels raid gold mine in Mindanao

Reuters

31st January 2007

MANILA . Members of communist rebel group, the New People's Army (NPA), have raided a gold mine in the southern Philippines ahead of a government auction for mining rights in the area, police said yesterday.

Some 50-heavily armed guerrillas set fire to a bulldozer and a welding machine belonging to local firm JB Mining and Management Corp. on Sunday morning after disarming two guards, regional police spokesman Belflor Causing said.

The mine was on a 8,100-hectare reservation on Mount Diwalwal, a famous gold-rush area on the southern island of Mindanao. The government is auctioning the right to explore and develop 4,000 hectares on Mount Diwalwal on March 2. The NPA, which has been waging one of the the world's longest-running communist insurgencies, is opposed to foreign and local corporations mining Philippine sites and has attacked companies and their operations before. Causing, however, said Sunday's attack was part of the rebels' attempts to extort "revolutionary taxes" from businesses.

"This is part of the extortion activities of the NPA," Causing said by phone, adding that the rebels stole a rifle and one .357 revolver from the guards. Officials of JB Mining were not immediately available for comment. President Gloria Macapagal Arroyo is trying to encourage foreign investment into the mining sector to reduce the country's debts and revive its once mighty industry. Diwalwal is one of 24 priority projects that the government is promoting. Manila has said the country has around $1 trillion worth of unexplored copper, gold and nickel. However, the 24 projects need at least $6.5bn in investments.

US-based Newmont Mining Corporation and Harmony Gold Mining Company Ltd, the world's second and fifth biggest gold producers have previously expressed interest in the Diwalwal project. Diwalwal was a mining town with more than 30,000 people operating illegal small-scale mines in the 1980s. In 2002, the government designated the town and its surrounding area as a mineral reservation area.

But locals fear they will be pushed out if the government sells the mining rights to a large, foreign company.

"We do not know if JB Mining is still operating," Franco Tito, village head in the area, told Reuters by phone. "Our problem here now is the government's plan to sell the mining area," Tito said.