Digging for profits: Who owns PH mines?

QUICK FACTS

Name of mining firm: AAM-PHIL Natural Resources Exploration and Development Corp.
Location: Basilisa and San Jose, Dinagat Islands
Mining area: 1,680.81 hectares
Metals extracted/mine products: Nickel and other associated mineral deposits
Nickel production: None reported for 2020 and 2019
Mining permit period: 2010-2035

 

OWNERSHIP

Incorporation date: Jan. 4, 2005

Stockholders: 
Kho, Kitson
Ngo, Francis Albert
Yap, Lorenzo
The Kho Group Philippines

President: Ngo, Francis Albert 

 

MINING REVENUE 

Current assets: P192.82 million (2019)
Current liabilities: P755.67 million (2019)
Ore sale: P147.96 million (2018)
Net income: -P33.88 million (2019)

 

MINE AUDIT FINDINGS (2016/2017)

The 2016 Mine Audit Report identified the following violations, among others, for Parcel 1 (Loreto) and Parcel 2B (Basilisa) of AAM-Phil’s operations in Dinagat Islands:

Parcel 1 (Loreto)

  • “Non submission of detailed marine baseline study, hydrologic characteristics of a primary impact area and detailed terrestrial fauna assessment;

  • Failure to secure Wastewater Discharge Permits (WDPs) for wastewater treatment facilities;

  • No updated submission of the MPEO/PCO of monitoring reports of the project environmental compliance;

  • Failure to observe easement requirement along waterways;

  • Failure to secure Tree-Cutting Permit from DENR prior to mining operation;

  • Failure to secure Tree-Cutting Permit and turnover forest products to the DENR;

  • Failure to turnover forest products to the DENR;

  • Failure to secure timber rights; and

  • Failure to secure a Tree-Cutting Permit from DENR prior to mining operation.”


Parcel 2B (Basilisa)

  • “No approved Care and Maintenance Program (CMP) during the middle part of 2014 and the whole of 2015 in lieu of the suspended operation;

  • Failure to maintain access roads within project site;

  • Failure to renew Wastewater Discharge Permits for settling Ponds and Absence of Complaints Management Procedures and Corrective Measures/Actions undertaken;

  • Improper implementation of stabilization and erosion control measures. Stockpile area located on top of a hill is prone to soil slides and erosion; and

  • No record of any Knowledge, Attitude, Practice (KAP) evaluation being conducted to determine the effectivity of the IEC program.” 

The full report and/or copy of the DENR order may be viewed here.

 

STATUS OF RECOMMENDATIONS / COMPANY RESPONSE (AS OF MARCH 2022)

PCIJ sent a letter to the company on Feb. 14, 2022, then called its offices on Feb. 22, 2022 and March 17, 2022, for follow-ups. We have not received a response as of this writing.

 

STATUS OF OPERATIONS

In February 2017, then Environment Secretary Gina Lopez ordered the closure of 23 mines, including AAM-Phils Natural Resources and Exploration and Development Corp. No update on the status of the mining operations could be found. The results of a review by the Mineral Industry Coordinating Council have yet to be released as of writing.

 

COMMUNITY PROFILE

Municipality class of mining location: Basilisa, Dinagat Islands (4th class)
Population: 36,880 (2015)
Poverty incidence rate: 41.97% (2015)
Human Development Index: No data available
Municipality class of mining location: San Jose, Dinagat Islands (4th class)
Population: 27,487 (2015)
Poverty incidence rate: 36.19% (2015)
Human Development Index: No data available

 

IN THE NEWS

Factbox: Philippines recommends suspending 20 more mines after audit
Mine closures, suspensions affirmed
Suspended mining firms submit rehabilitation plans

 

Sources:

General Information Sheet, 2020
List of existing Mineral Production Sharing Agreements, Mining and Geosciences Bureau
Philippine Metallic Mineral Production, Mines and Geosciences Bureau
Poverty and socioeconomic indicators, Philippines Statistics Authority

Copy of full Mine Audit Reports by company, 2016
Copy of Notices of Issuance of an Order, 2017
Copy of Orders of Cancellation and/or Suspension, 2017

Acronyms used:

RA (Republic Act)
IRR (Implementing Rules and Regulations)
PD (Presidential Decree)
DAO (Department Administrative Order)
MPSA (Mineral Production Sharing Agreement)
SDMP (Social Development and Management Plan) 

 

Disclaimer: The mine audit was conducted in 2016 after Regina “Gina” Paz Lopez assumed the post of environment secretary. The findings in the reports, which authorities sent to the mining firms in 2016, were likely addressed in the succeeding years following a review conducted by the Mining Industry Coordinating Council after the audit led by Lopez, who died in 2019. PCIJ has verified the reports and reached out to each company for comment. We suggest you also confirm findings included in the reports as some information may have changed over time.

The reports come from files that PCIJ has received in connection with various environmental investigations. We are releasing them in full, recognizing the public value of the files to mining communities, miners, policymakers, civil society, and researchers.
Note: The Human Development Index is a measure of how well a country has performed, not only in terms of real income growth, but also in terms of social indicators that measure people's ability to lead a long and healthy life, acquire knowledge and skills, and have access to the resources needed to afford a decent standard of living. An HDI value below 0.550 is considered low and below 0.399 is very low. The national average for the Philippines is 0.718 as of 2020.

This article was produced with the support of Internews' Earth Journalism Network.

— PCIJ, March 2021