Digging for profits: Who owns PH mines?

QUICK FACTS

Name of mining firm: Libjo Mining Corp.
Location: Libjo, Dinagat Islands
Mining area: 4,226.27 hectares
Metals extracted/mine products: Nickel
Nickel production (2020): 253,403 dry metric tons (direct shipping ore) valued at P359,273,954
Mining permit period: 2007-2032

 

OWNERSHIP

Incorporation date: June 6, 2012

Stockholders: 
Zamora, Salvador II B.
Borra, Juan Fernando Merris
Zamora, Salvador III T.
East Coast Mineral Resources Co. Inc. Domestic Corp.
Pagauitan, Hilario G.
Hong Kong Yichen International Mining Ltd. Chinese Corp.
Wuquing Zhao
Yinghu Yang
Shuling Bi

Chairperson of the Board: Zamora, Salvador II B.

 

MINING REVENUE 

Current assets: P351.65 million (2019)
Current liabilities: P1.02 billion (2019)
Total revenue: P302.88 million (2019)
Revenue from sale of nickel ore: P303.18 million (2019)
Net income: -P25.31 million (2019)

 

MINE AUDIT FINDINGS (2016/2017)

According to the Notice of Issuance of an Order sent to Libjo Mining on Feb. 8, 2017 pertaining to operations under MPSA 223-2007-XIII, the company had violated certain provisions of:

  • PD 1586 or “Establishing an Environmental Impact Statement System including other Environmental Management-related Measures and for other Purposes;”

  • DAO 2003-30 or the IRR for the Philippine Environmental Impact Statement System;

  • RA 7942 or the Philippine Mining Act of 1995;

  • DAO 2010-21 or the Revised IRR of RA 7942;

  • PD 1067 or the Water Code of the Philippines;

  • Natural Water Resources Board Resolution dated March 21, 2005, amending the IRR of the Water Code;

  • RA 8749 or the Clean Air Act of 1999;

  • DAO 2006-26 amending Rule XIX of DAO 2000-81 (IRR of RA 8749);

  • PD 705 or the Revised Forestry Code of the Philippines;

  • DAO 1987-80 or the regulations governing the measurement, assessment and payment of forest charges on timber and other forest products;

  • DAO 2012-02 or the uniform replacement ratio for cut or relocated trees;

  • DAO 2000-98 or the Mine Safety and Health Standards.



Field validation by the DENR determined that Libjo’s mining operations had impaired the functions of the watershed and were causing siltation of the coastal waters.

The DENR review of the audit report as well as explanations from the company showed that it had violated certain provisions of the following laws, rules, and regulations:

  • PD 1586 or “Establishing an Environmental Impact Statement System including other Environmental Management-related Measures and for other Purposes”;

  • DAO 2003-30 or the IRR of the Philippine Environmental Impact Statement System;

  • RA 7942 or the Philippine Mining Act of 1995;

  • DAO 2010-21 or the Revised IRR of RA 7942;

  • PD 1067 or the Water Code of the Philippines;

  • Natural Water Resources Board Resolution dated March 21, 2005, amending the IRR of the Water Code;

  • RA 8749 or the Clean Air Act of 1999;

  • DAO 2004-26 amending Rule XIX of DAO 2000-81 (IRR of RA  8749);

  • PD 705 or the Revised Forestry Code of the Philippines;

  • DAO 1987-80 or the regulations governing the measurement, assessment and payment of forest charges on timber and other forest products;

  • DAO 2012-02 or the uniform replacement ratio for cut or relocated trees; and

  • DAO 2000-98 or the Mine Safety and Health Standards.



These violations, according to the order, constituted sufficient grounds for the cancellation of the firm’s MPSA.

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. 16, 2022 and made follow-ups on March 2, 2022 and March 24, 2022. We have not received a response as of this writing.
 

STATUS OF OPERATIONS

In February 2017, the Department of Environment and Natural Resources (DENR) cancelled the company’s mineral production sharing agreement.
On Nov. 12, 2018, the DENR issued a resolution (1) partially granting the company’s motion for reconsideration on the 2017 cancellation; (2) suspending the operation of the company; and (3) directing the company to do the following:

a. correct all violations and deficiencies, including replacement planting in accordance with DENR Memorandum Order No. 2012-02 prescribing a uniform replacement ratio for cut or relocated trees; and
b. pay all fines and penalties immediately upon receipt of the resolution.

The company filed an appeal on the November 2018 order before the Office of the President.

 

COMMUNITY PROFILE

Municipality class of mining location: Libjo, Dinagat Islands (5th class)
Population: 17,760 (2015)
Poverty incidence rate: 43.56% (2015)
Human Development Index: No data available

 

IN THE NEWS

Mine closures, suspensions affirmed
14 mining firms still operating despite suspension order

 

Sources:

General Information Sheet, 2020
Financial Statement, 2019
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