MAC/20: Mines and Communities

Philippines update

Published by MAC on 2007-02-17


Philippines update

17th Feburary 2007

For yet another week, objections to the permission granted Lafayette to resume full operations at its Rapu Rapu project, dominate Philippine mining news. On 14 February a petition was launched by local objectors and their supporters, calling on the project financiers to withdraw support. It can be signed onto digitally, at:

http://www.banktrack.org/index.php?show=aletter&va=76.

The local Bishop continues to condemn the project, while, significantly, the Catholic Bishops' Conference of the Philippines (CBCP) has reaffirmed its call for repeal of the 1995 Mining Act.

The Philippines has now overtaken Australia in exports of nickel ore (by bulk, as it is low grade) to China.

However, even the Philippine Government has had to think twice about selling off mining rights to foreign multinationals (including Crew) for the troubled 'gold-rush' area of Mt. Diwata.


Fight against Lafayette Mining far from over

Kalikasan-PNE Press Release

14th February 2007

Denouncing DENR Secretary, Angelo Reyes, his heartless decision to reopen Lafayette's Rapu-Rapu mine and his utter lack of love for the island and its residents, Defend Patrimony alliance today announced the start of an international petition addressed at Lafayette Mining's corporate financiers and the formation of the Save Rapu-Rapu Task Force that would continue to monitor the situation in Albay and campaign for the permanent closure of Lafayette.

"The fight against the Lafayette mine reopening is far from over. We are not the least appeased by Sec. Reyes' public reassurances that Lafayette Mining will no longer cause environmental damage. We'll be closely monitoring the situation in Rapu-Rapu and will continue to work for Lafayette's permanent pull-out in the island," declared geologist and Defend Patrimony Spokesperson Trixie Concepcion. Defend Patrimony along with national fisherfolks federation PAMALAKAYA today presented their "Valentines Day gifts" to the DENR, including a mock program of the world record-breaking 'Lovapalooza' kissing spree and announcements of more protest actions against Lafayette.

Concepcion said that environmental groups and local Rapu-Rapu folk would make international a massive "shame campaign" against Lafayette Mining's continuing presence in Rapu-Rapu. This is to be initially done through an international petition addressed to major bank financiers of Lafayette such as ABN AMRO of the Netherlands, ANZ of Australia, Standard Chartered
Korean First Bank (KFSC) of South Korea and shareholders as JPMorgan Chase.

The international petition was initiated early this January by Sagip-Isla, Sagip Kapwa, a local alliance in Rapu-Rapu opposed to Lafayette's mining operations. The first wave of petition-signing this February has quickly gathered hundreds of signatories among the island's residents alone.

"As of now we have gathered 1,384 signatures from the local residents of Rapu-rapu in just one week. We are targeting to get around 80-90% of the island's households in the island to support the petition. This is another way to demonstrate that the significant majority of the local people do not want large-scale mining in their lands and expose that Lafayette is operating without social consent," said local Rapu-Rapu elder and Sagip-Isla leader Antonio Casetas.

The text of the petition reads that "contrary to what is routinely claimed by LPI and communicated to its financiers, the project utterly lacks local community support, therefore operating without having obtained the 'social license to operate,' as required in covenants as the 'Equator Principles' that are supposed to govern your (bank financiers) investment decisions."

"WE THEREFORE URGE the consortium of financiers to the LPI mine in Rapu-Rapu to immediately withdraw their assistance to this financially-unstable, environmentally-destructive, and socially-insensitive project that deserves nothing but outright censure and closure," said in the petition.

Defend Patrimony said that the petition is also gathering more supporters from the national level. Among the Bicolono personalities and who support the petition are Sorsogon Bishop Arturo Bastes, Congressman Satur Ocampo, and Dr. Regina Regis.

"We want to show to the world that until now Lafayette does not enjoy public support and what is happening now in Rapu-rapu is pure plunder and devastation. Through the petition, we are requesting the bank financiers to withdraw their financial support to the polymetallic mining project of Lafayette in Rapu-rapu," Ms. Concepcion adds.

"Banks as ABN AMRO, ANZ, JPMorgan Chase and Standard Chartered choose to take a huge ´RapuRaputational´ risk with their continued involvement in this mining operation" said Johan Frijns, coordinator of BankTrack

Based in The Netherlands, Banktrack is worldwide network of civil society organizations and individuals tracking the operations of the private financial sector and its effect on people and the planet. Banktrack also spearheads the petition campaign at the international level.

"International banks keeping Lafayette afloat are strongly advised not to derive any false reassurances from the decision to grant the mine a permanent lifting order", Frijns said, "the issues that make this a extremely risky investment for any bank pretending to be serious about sustainability will remain. With no social license to operate, leading to continued widespread opposition to the mine, and operating under adverse natural conditions the very same issues that led to the earlier suspension of operations will return on their plate."

Frijns has tallied at least 285 individuals representing at least 60 international organizations that have supported the petition during its initial wave of dissemination.

Starting today, the petition will be made available to the public this week via the internet, where people may directly sign up to support at www.banktrack.org, Concepcion said. ###

CLEMENTE BAUTISTA national coordinator
Kalikasan-People's Network for the Environment (Kalikasan-PNE)
No.26 Matulungin St. Bgy, Central, Quezon City, Philippines 1100
Tel. No. +63-2-9248756 Fax No. +63-2-9209099
Email: kalikasan.pne@gmail.com


Environmentalists sign petition vs Lafayette mine

Asia Journal

16th February 2007

MANILA, Philippines -- Some 800 environmentalists from 27 countries have signed a petition urging major financiers to withdraw their investments from Lafayette's newly reopened mining project on Rapu-Rapu island in Albay, a militant group of fishermen said Friday.

The Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (Pamalakaya) said the environmental leaders and activists from the United States, Europe and Asia signed the petition initiated by a multi-sectoral group of Rapu-Rapu residents, Church and civil society leaders, environmentalists, academicians and scientists in less than a week.

The signatories were from The Netherlands, Spain, United Kingdom, Denmark, Greece, Switzerland, Norway, France, Ireland, Italy, Germany, Belgium, Canada, Australia, the Philippines, Hong Kong, Ecuador, United States, Malaysia, Bangladesh, Taiwan, Indonesia, Thailand, India, Nigeria, Egypt and Mexico.

"This is a major victory for the Rapu-Rapu people and all crusaders for the environment and public interest. This is the beginning of Lafayette's end,'' Fernando Hicap, chairman of Pamalakaya, said in a statement.

Some 2,000 individuals and groups from Rapu-Rapu also signed the petition, according to Greenpeace.

Pamalakaya, and the environmental groups Defend Patrimony and Kalikasan-People's Network for the Environment had protested last week's reopening of Lafayette's controversial mining project on the orders of Environment Secretary Angelo Reyes.

Reyes said the company had met the conditions set by the Department of Environment and Natural Resources.

The multi-sectoral group had called on ABN Amro of The Netherlands, ANZ of Australia, KFSX of South Korea and Standard Chartered Bank of the United Kingdom to stop supporting Lafayette Philippines Inc. and its project.

They said disasters were bound to happen because the island lies in the middle of a typhoon belt, and the financiers would be liable for any accidents if they continued supporting Lafayette. Lafayette Mining operation were suspended in 2005 following two mine tailing spills that resulted in cyanide contamination and fish kills. (Inquirer.net)


Lafayette restart slammed

By: Nikko Dizon and TJ Burgonio, Philippine Daily Inquirer

15th February 2007

A Catholic Bishop and various environment groups have denouced the government's recent decision to allow the resumption of operations of the Australian-operated Lafayette Mining Ltd. in Rapu-rapu, Albay.

"They just don't get it," Sorsogon Bishop Arturo Bastes said in a statement released Monday, insisting that mining in Rapu-rapu is "inappropriate" and "detrimental" to the environment.

"It's heartless," said the head of the militant fisherfolk group Pambansang Lakas ng Kilusang Mamamalakaya.

Members of Pamalakaya staged a protest rally at the Department of Environment and Natural Resources yesterday, highlighted by what they dubbed a "fishapalooza" (a parody of Manila's kissing couples "lovapalooza") where they literally kissed Tilapia fishes goodbye to dramatize their fears.

In 2005, Lafayette Mining was suspended following two mine tailing spills that resulted in cyanide contamination and fish kills.

Bastes said he would hold Environment Secretary Angelo Reyes and Lafayette "responsible for further danger and damage that will occur on the island."

The bishop said he was not conviced by Reyes' assurance that "everything is oky with the mining operations."

The protesters--composed of Rapu-rapu residents, Church leaders, environment organizations, academecians and scientists -- went a step further and wrote the financiers of Lafayette Philippines Inc. (LPI), urging them to withdraw their investments from the controversial mining project.

The group issued the call to ABN AMRO, Standard Chartered, and ANZ, among other financiers of Lafayette.

"Similar or more tragic incidents are highly probable to occur again during or even after the mine-life of the polymetallic mining project and you, as financiers of this project, would be equally accountable as LPI and related companies are," it said in a petition.

Beau Boconguis, media campaigner of Greenpeace, said the world environment group was also saddened by the decision to reopen the mine.


Villagers watchful of Lafayette mining

By Ephraim Aguilar, Inquirer

15th February 2007

VILLAGERS living near the Lafayette mining site in Rapu-Rapu, Albay say they remain vigilant, as they continue to have qualms about the government's decision to allow the full resumption of the company's operations. "Maybe there's nothing more we could do to oppose the mining. But we would be in favor of it, if only the mining process is done correctly," said Milo Asuncion, 47, councilor of Barangay Pagcolbon.

He said the residents were also afraid of the risks posed by the mining operations, especially during natural disasters, which may threaten fishing, their main source of living.

Aladin Valenzuela, 56, of Barangay Linao, however, said he was in favor of mining because it could give jobs to the villagers.

In fact, Valenzuela's 21-year-old son and nephew were jobless until they were hired as laborers for the mining site.

"I used to plant coconut and abaca but since the typhoons destroyed my crops I could no longer earn a living. We now rely on my son's earnings from Lafayette," he said.

However, there were not really many jobs created by the mining company in the community, he said.

"Many would apply and spend money for the application but only a few could be employed in the company," Valenzuela said.

Rally Environmental activists, however, staged a rally in front of the DENR central office and shaved off their heads to protest "Lafayette's denudation of Rapu-Rapu island."

The Kalikasan-PNE, in a statement, called on the government to investigate the cause of reported mysterious deaths at Sitio Acal, some 15 kilometers away from the mining site.

Clemente Bautista, Kalikasan-PNE national coordinator, said the reported Sitio Acal deaths have been initially verified by field reports from the DENR-Bicol and the Rapu-Rapu Municipal Health Office documenting at least four persons dead and two sick.

According to the report, the fatalities include a certain JV Ebrada, 17 years old, with swollen legs and feet. Among the sick were a certain Victor Ebrada, 40, who had swollen legs and feet and Maribel Dorado, 22, whose entire body was swollen.

"We are not inclined to take deaths from local communities lightly, especially if these may be related to environmental problems," the group stated, adding:

"Whether or not the Lafayette mining operations is the culprit in the Sitio Acal deaths, we take this opportunity to assert that the real threat of heavy metal pollution on the local communities' health will remain and will intensify for as long as Lafayette mining is allowed to operate in Rapu-Rapu."

But Lafayette branded Kalikasan-PNE's allegations as "baseless and irresponsible" citing the mining site's 15-km distance from Barangay Mananao where the reported deaths occurred.

"Initial findings showed the deaths to have been caused by high fever or infection. Efforts to further verify these by getting official medical reports and death certificates are underway," Lafayette said in a statement.

It added that Kalikasan-PNE and other groups have used similar tactics in the past and somehow succeeded in using the media to scare people unnecessarily.


Bishops call on Arroyo to repeal mining law

Christian Esguerra, Inquirer with Agence France-Presse

29th January 2007

CATHOLIC bishops in the Philippines on Sunday urged President Gloria Macapagal-Arroyo to work to repeal a law that opened up the mining industry to foreign firms, citing environmental concerns.

The politically influential Catholic Bishops' Conference of the Philippines (CBCP) in a message delivered after a national conference said "adverse social impacts" would far outweigh a boom in the mining industry.

"We reaffirm our stand for the repeal of the Mining Act of 1995," the conclave said.

"Allowing the interest of the big mining corporations to prevail over people's right to these sources amounts to violating their right to life," the CBCP said in a two-page pastoral statement.

In the statement read by Sorsogon Bishop Arturo Bastes, the CBCP expressed alarm over the deletion of the nationalist provisions in the Constitution being pushed by the Macalanang-formed consultative commission.

If it succeeds, the move could "pave the way [for] the wholesale plunder of our national patrimony and undermine our sovereignty," the bishops warned.

"We believe that the Mining Act destroys life," the CBCP said. "The right to life of people is inseparable from their right to sources of food and livelihood."

"Furthermore, mining threatens people's health and environmental safety through the wanton dumping of waste and tailings in rivers and seas," the CBCP said.

"We reiterate our request to the president to recall all approved mining concessions, and to disapprove pending applications," it said.

The church has been at the forefront of efforts to stop the legislature from opening up the mining industry and has waged a legal battle to have it declared unconstitutional.

But in December 2004 the Supreme Court ruled that the mining law was constitutional, lifting the final obstacle for foreign companies in the industry.

The perenially cash-strapped government last year said it estimated a windfall of up to 90 billion dollars in foreign investments in the mining industry with 23 major mining projects in the pipeline.

While the law calls for the separation of the state and church, the Catholic hierarchy remains a strong political force in the Philippines, where over 80 percent belong to the religion.


Chinese imports of nickel ore to surge

Shanghai Daily

13th February 2007

Atlas Consolidated Mining & Development Corp has said it plans to ship 45,000 metric tons of low-grade nickel ore from the Philippines to China this month, more than doubling January's exports to the world's biggest consumer of refined nickel.

The company, the second-largest Philippine miner by market value, exported 19,000 tons of the ore to China from its Berong mine last month, Atlas Executive Vice President Martin Buckingham said in an interview in Manila, without naming the company buying the ore.

China's imports of low-grade nickel ores from the Philippines may reduce pressure on global stockpiles of the refined metal, which fell to the lowest in 15 years on February 6. Nickel prices have more than doubled in the past year, prompting China to produce more of the metal from cheaper imported ores.

"One of the most important developments in the nickel market over the past 15 months has been the massive increase in China's production of low-grade ferronickel," Goldman Sachs JBWere Pty Ltd, the Australian affiliate of the world's most profitable investment bank, said on Friday.

Nickel for delivery in three months on the London Metal Exchange fell one percent, to US$35,800 a ton as of 9:13am local time yesterday. The metal traded at a record US$38,950 on January 26.

"China is where most of the demand is," Buckingham said. China increased production of nickel from low-cost laterite ores last year as the price of the refined metal surged.

Laterite ores, containing nickel and cobalt, are processed using blast furnaces into nickel pig iron, containing about one to three percent nickel that can be used by stainless steel makers to produce goods such as sinks, cutlery, pots, pans and appliances.


Philippine gold enchants but does not enrich

By Carmel Crimmins, Reuters

13th February 2007

MOUNT DIWATA, Philippines - "Those who are afraid to die should not come to Mount Diwata," says Franco Tito.

It's fighting talk but his words carry weight.

Spooked by the threat of violent opposition, the Philippine government has junked plans to auction the right to explore and develop Mount Diwata, or mountain of "The Enchanted Lady", an infamous gold rush area 965 kilometres south of Manila.

The cancellation is a setback for the Philippines, which wants to attract $6.5 billion in foreign investment to revive its once-mighty mining sector.

But in their tightly packed wooden shacks on top of the mountain, Diwata's 40,000-strong community see it as a victory.

"They want to drive us away from this area and we have no where to move," said Tito, captain of the village. "It's like stealing our patrimony. We started this."

The lure of gold has attracted tens of thousands small-scale miners to Mount Diwata, or Diwalwal as it is commonly known, transforming a once uninhabited wilderness to a rubble-strewn settlement where processing waste has killed the local river.

Most of the fortune-hunters live a dangerous, hand-to-mouth existence, forced to process the ore in mercury-filled drums under their houses and risking cave-ins underground.

But with no alternative source of income they will not leave.

"Where would the people go? They have already lived here for almost 20 years and raised their families here," said Joseph Diosana, an administrative officer in the village, on the southern island of Mindanao.

Inhospitable

Beneath its rocky soil and canopy of forest, Diwalwal is believed to have the richest gold deposit in the Philippines, itself considered a world-class treasure trove of mineral wealth.

The government has estimated the 8,100-hectare reservation has a gold resource of about 2.9 million metric tonnes at six grams per tonne and 5.8 million metric tonnes at 9.6 grams per metric tonne in two mineral reserves.

Small-scale miners are only allowed to tunnel 729 hectares and lack of funds means they do not have the equipment and processing facilities to extract the gold efficiently and safely.

Government geologists have estimated that with the right technology and methods, ore production could expand to 2,000 metric tonnes per day over a 15-year mine life.

The small scale minters are currently yielding around 50 tonnes per day at eight grams per tonne, according to the department of the environment and natural resources.

Only large, international players have the necessary firepower to tap Diwalwal's full potential but even for mining giants used to operating in some of the world's most inhospitable territories, the enchanted lady is too much to handle.

Besides the threat from small-scale operators with easy access to guns, four indigenous tribes claim ownership rights over the reservation and communist rebels, who extort "revolutionary taxes" from businesses, lurk in the hinterland.

Diwalwal's scarred environment and opposition from anti-mining bishops in the Catholic Church are further obstacles.

Guns and Goons

The government said in 2003 that Diwalwal was an acid test for dealing with problems of land ownership and violence that hobble the mining sector. But a solution was never found.

Earlier this month, Manila called off the auction because it said it wanted to "address first the various issues prevailing".

Romeo Serra, chairperson of the Mindanao Business Council, said the government was wary of stirring up trouble ahead of May's congressional elections and said the auction might be revived after the polls.

But even if the Diwalwal sale is resumed, foreign interest is likely to be minimal unless the small-scale miners are won round.

"Who wants to put in millions and millions of dollars as a performance bond on something that is uncertain, on something that you know is chaotic, on something that you know nobody has a clear idea who is in control and who is not?" said Serra.

"It's practically a no-man's land, where guns and goons rule. What foreign investor big enough would dare put investment in this?"

Only four prospective bidders submitted pre-qualification documents to participate in the Diwalwal sale after at least 27 firms, including Newmont Mining Corp., the world' second-biggest gold producer, originally expressed interest.

Only one of the four prospective bidders was foreign, Oslo-listed Crew Minerals, according to a government source.

Wild, Wild West

A Mandaya tribesman first discovered gold nuggets in Diwalwal in the early 1980s, triggering an influx of fortune-hunters that at its height had up to 100,000 miners competing for treasure.

Cave-ins, landslides, mercury contamination and tit-for-tat killings earned the mountain the nickname, "the wild, wild west of the Philippines" and in 2002 the government stepped in to restore some semblance of order.

Life on Diwalwal is now relatively peaceful but still wretchedly poor despite the treasures beneath.

The government has worked out a deal with the small-scale miners that sees them give 15 percent of their output to the state, which in turn chooses to ignore their illegal use of explosives and discharge of toxic waste into the Naboc river.

Control of the more than 100 tunnels that honeycomb part of the mountain is concentrated among a handful. Save for the odd hiphop-style gold chain and expensive sneakers, signs of wealth are few and far between.

The miners fear an international corporation would put them out of a job and a home and want instead to be allowed to use heavy equipment and more space to tunnel.

But while they dream of gold, they want better things for their children. In the local school -- one of Diwalwal's few public amenities -- ace students are given a 16-karat gold medal as an incentive to get off the mountain.

"We encourage them to study because a miner's life is very hard, you only have a 50/50 chance of surviving," said Tito.

 

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