Mine profile: Citinickel Mines and Development Corp.

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Digging for profits: Who owns PH mines?

QUICK FACTS

Name of mining firm: Citinickel Mines and Development Corp.
Location: Narra, Sofronio Espanola, Palawan
Mining area: 2,176 hectares
Metals extracted/mine products: Nickel 
Nickel production (2020): 499,573 dry metric tons valued at P1,061,090,654
Mining permit period: 2007-2032

OWNERSHIP

Incorporation date: May 6, 2006

Stockholders:
Pallera, Ferdinand M.
Fabella, Jose Marie E.
De Regla, Miguel D.
Radaza, Kenneth C.
Cabahug de Leon, Reynilda C.
Oriental Peninsula Resources Group Inc.
King Grown Group Limited
Olympic Mines & Dev. Corp.

Chairperson of the Board: Pallera, Ferdinand M.

MINING REVENUE 

Current assets: P1.62 billion (2019)
Current liabilities: P266.95 million (2019)
Total revenue: P366.49 million (2019)
Revenue from sale of nickel ore: P363.63 million (2019)
Net income: -P469.98 million (2019)

MINE AUDIT FINDINGS (2016/2017)

According to the Notice of Issuance of an Order issued to Citinickel, an order was issued to the firm on Feb. 8, 2017 pertaining to operations under MPSA 229-2007-IVB.

The result of the audit showed that Citinickel had violated mining and environmental laws, such as:

• failure to submit land use;

• quarterly status and production reports;

• failure to secure the Strategic Environmental Plan (SEP) clearance;

• lack of a special tree-cutting permit,

• lack of a designated Community Relations Officer; and

• not fully implementing the Social Development and Management Program, among others.


DENR’s further field validation also found that the mining operation of Citinickel has impaired the functions of a watershed in the area.

The order likewise states that company has violated certain provisions of the following laws and implementing rules and regulations:

• RA 7942, otherwise known as the Philippine Mining Act of 1995; and

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


These violations, according to the order, constituted sufficient grounds for the suspension of Citinickel’s mining operations.      

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. 10, 2022 and made follow-ups on March 2 and 24, 2022. We have not received a response as of this writing.

STATUS OF OPERATIONS

On Feb. 8, 2017, the Department of Environment and Natural Resources (DENR) issued an order suspending the mining operations of the Citinickel due to violations of certain provisions of Republic Act 7942 or the the Philippine Mining Act of 1995 and its revised implementing rules and regulations.

The company filed an appeal before the Office of the President on March 1, 2017.

According to the Mines and Geosciences Bureau, the company is allowed to ship ores after posting a surety bond, despite the suspension.

COMMUNITY PROFILE

Municipality class of mining location: Narra, Palawan (1st class)
Population: 73,212 (2015)
Poverty incidence rate: 18.3% (2015)
Human Development Index: 0.55 (2012, provincial)
Indigenous peoples living within or near the mining location: Tagbanua
Municipality class of mining location: Sofronio Espanola, Palawan (2nd class)
Population: 32,876 (2015)
Poverty incidence rate: 30.4% (2015)
Human Development Index: 0.572 (2012, provincial)
Indigenous peoples living within or near the mining location: Tagbanua

IN THE NEWS

Citinickel fined for pond spill in Palawan
Palawan mining firm operating despite suspension order, says NGO

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.