Oriental Peninsula mine unit suspended by MGB

2016072864db8In a disclosure to the stock exchange, Oriental Peninsula attached a Mines and Geosciences Bureau (MGB) order announcing “the suspension of the mining operations under Mineral Production Sharing Agreement [MPSA] No. 229-2007-IVB granted to Citinickel Mines and Development Corp. (CMDC), subject to the result of the mine audit to be undertaken pursuant to Development of Environment and Natural Resources memorandum Order No. 2016-01 dated July 8, 2016.”

THE government has suspended a unit of listed miner Oriental Peninsula Resources Group, Inc., which operates two projects in Palawan.

 The MPSA, which grants CMDC the exclusive right to explore, develop,and commercially utilize nickel and other associated mineral deposits, covers a 2,176-hectare area situated in Narra and Sofronio Española in Palawan.

In May 2011, the MGB approved on an interim basis the CMDC’s Declaration of Mining Project Feasibility (DMPF) covering its MPSA, subject to “strict compliance” with certain terms.

Conditions include the firm’s submission of the revised Three-Year Development and/or Utilization Work Program (3YD/UWP), an approved Environmental Protection and Enhancement Program, and a Final Mine Rehabilitation and/or Decommissioning Plan.

The MGB later issued the final DMPF, which serves as the government’s stamp of approval for the firm to continue with its development and operations including the extraction of nickel ore within the contract area .

In September, however, CMDC was found to have extracted minerals from a new mine area it developed that was outside the parameters of the Strategic Environmental Plan approved by the Palawan Council for Sustainable Development, prompting MGB Region IV-B to issue a cease and desist order (CDO).

The act was in violation of Republic Act No. 7611, the Strategic Environmental Plan (SEP) for Palawan Act.

CMDC’s new mine area was also found to be outside the coverage of the approved 3YD/UWP and a Special tree Cutting Permit.

In addition, the Environmental Legal Assistance Center, Inc., an environmental nongovernment organization, has sought the cancellation of the firm’s MPSA, citing certain violations, according to the notice.

CMDC’s continued operation will depend on the audit by the Department of Environment and Natural Resources (DENR), which is required for all operating mines across the country.

“The decision of the DENR whether or not to allow mining operations starts with the results of the audit… The audit team has a set of criteria that embody the principles of the secretary of DENR,” MGB Director Leo L. Jasareno told reporters on Wednesday, adding that one criterion is that mining operations must help improve the lives of local residents.

Mr. Jasareno added that the audit process will start in Mindanao “not just because it’s the President’s priority but secondly, that is the request of the Lumad,” or the indigenous people of the southern island.

In talks with DENR Secretary Regina Paz L. Lopez, the lumad complained of destruction of their communities by mines in Surigao, Mr. Jasareno said.

Two audit teams are due to visit and assess within the week four mines in the Surigao provinces — SR Metals, Inc., Taganito Mining Corp., Greenstone Resources Corp. and Claver Mineral Development Corp.

The teams include representatives from the Department of Agriculture to assess effects on farmland, from the Bureau of Fisheries and Aquatic Resources to study nearby waterways, from the Social Action Center to evaluate the impact on communities, and from the Department of Health to inspect the health of residents.

“If we have 40 mines, I would simply say that about 40% are facing complaints. Four mines in Zambales are facing complaints… Surigao is generating maybe half of the complaints. If you base your decisions on complaints, it’s overwhelming so we will take a scientific approach,” Mr. Jasareno added.

The final audit from regional offices will be submitted directly to Ms. Lopez, according to Mr. Jasareno.

The director added that the audit intends to “populate the industry with responsible miners in its truest sense,” which in turn will boost investor confidence in a sustainable industry, encouraging more investment.

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