Tampakan copper-gold project, Semirara open-pit coal mine risk losing permits

Posted on August 12, 2016

THE ENVIRONMENT department has threatened to revoke the permits of the Tampakan copper-gold mine project in Mindanao — initially estimated to cost some $5.9 billion and which has suffered delays since 2010 due to regulatory and policy hurdles — as well as the open-pit mine in Antique of listed Semirara Mining & Power Corp., the country’s biggest coal producer, officials said in a press briefing yesterday.

“Based on the review, the DENR will be asking the Tampakan (project proponent) to show cause why their [sic] ECC should not be revoked.”

Tampakan is estimated to have 15 million tons of copper and nearly 18 million ounces of gold.

At least $500 million has so far been spent for the project’s pre-development stage.

Asked whether government will reimburse the company for what it has already spent for the project, Mr. Jasareno replied in the negative, citing the Philippine Mining Act of 1995 that provides that all risks are assumed by mining contractors.

SEMIRARA TOO
Semirara Mining & Power Corp. (SMPC) has also found itself in DENR’s cross hairs.

“We’re issuing a show cause,” Environment Secretary Regina Paz “Gina” L. Lopez said in the same briefing, referring to SMPC’s open-pit mine on Semirara island in Antique province that provides coal for the company’s two-unit 600-megawatt power plant in Calaca, Batangas.

“[The] open pit is now below sea level. Semirara has an area of 5,000 ha. The present pit occupies about 40 ha, but there is new expansion area of around 600 ha in the middle of the island,” Mr. Jasareno explained.

“If mining commences, the issue is what will happen after the mining? How would DMCI do rehabilitation of the island if you have such a big hole in the area. The issues on pollution have to be addressed,” he added, referring to listed DMCI Holdings, Inc. that controls SMPC.

But asked if SMPC could lose its permit, Mr. Jasareno said the department “will still be studying the implications” of such action.

“They are not that easy to close because if we do that, it will affect the electric supply of the country,” Ms. Lopez said. “The energy mix is too anchored on dirty coal.”

Coal-fired power plants account for around 32% of the country’s 18,445 MW installed capacity.

Asked on the possibility of canceling SMPC’s permit if there were cause to do so, EMB Director Gilbert C. Gonzales replied: “Wala tayong choice (We will not have any choice but to do so).”

“We recognize the importance of the existing project pero meron din naman kamingresponsibility to protect the environment.”

In a disclosure to the bourse, SMPC said it had yet to receive a copy of the show-cause order, but emphasized that it “has been fully complying with all relevant laws and regulations.”

“Our mining and environmental protocols also conform with the conditions of our Environmental Compliance Certificates,” SMPC said.

“We hope that our company will be accorded due process throughout any pre- and formal audit process of the government.”

Mr. Jasareno yesterday also said that the DENR has suspended the mining operations of chromite producer Mt. Sinai Mining Exploration and Development Corp. and nickel miner Emir Mineral Resources Corp. on Homonhon Island, Guiuan, Eastern Samar for various violations of environmental laws, taking the total number of suspended miners to 10.

Ms. Lopez also said DENR has issued a show-cause order on Century Communities Corp. of listed Century Properties Group, Inc. which plans to build a subdivision near La Mesa Dam. “They have to secure the approval of the two water concessionaires operating in La Mesa and I don’t think that they will ever get that approval.”

Saying “Century Communities has not commenced any development on the subject property,” Century Properties said in a statement yesterday that its subsidiary, which secured an ECC last year, “made a thorough and comprehensive study of the development project that focused primarily on the possible impact on the watershed and all the environs around the subject property.”

Stock prices of affected listed companies succumbed with the rest of the bourse, with those of SMPC losing 5.95% to end P109 apiece, those of parent DMCI giving up 1.39% to P12.80, those of Century Properties ceding 1.59% to 62 centavos and those of Alsons Consolidated Resources, Inc. that indirectly controls SMI dropping 2.02% to finish 1.94% each. — J. C. Lim