By Adrian H. Halili, Reporter
THE SENATE is gathering data to support its position on a five-year grace period before imposing a ban on the export of unprocessed minerals, its president, Francis G. Escudero, said, as legislators sought to harmonize the two chambers’ versions of a mining fiscal regime bill.
“We are already in the stage of the bicameral conference committee on the mining fiscal regime (and are discussing the proposed) five-year ban,” Mr. Escudero said in a Senate committee hearing.
“That’s one of the main reasons why I conducted this hearing, actually — to be able to get some data to justify that period or an extended period,” he said, noting that the House version of the bill contains no such grace period.
Senate Bill No. 2826 or the Enhanced Fiscal Regime for Large-Scale Metallic Mining bill, which the Senate approved on third reading on Feb. 3, wants a five-year delay before imposing an ore export ban to give miners time to set up processing plants in the Philippines.
Environment Undersecretary Carlos Primo C. David said at the hearing that gauging the impact of the delay is difficult because prices for mineral products fluctuate.
“We should study this very carefully because the prices of raw ore versus processed byproducts vary,” Mr. David said.
Using nickel prices as an example, he added that there are times where processed nickel prices drop, while those of raw ore remain still high.
The Philippines is among the biggest exporters of raw nickel, a key material used in electric vehicle batteries as well as in stainless steel. Most Philippine raw nickel exports go to China, with the remainder taken up by Japan.
In a separate briefing, Mr. Escudero said that the minerals being considered for export bans are gold, copper, nickel, and iron.
“The government can immediately ban the export of gold ore as processing facilities are already present in the country. For copper there are already facilities, but the processing (capacity) is lacking. We still don’t have (facilities) for nickel and iron,” he said.
“So, the period can depend on the mineral,” Mr. Escudero said.
He added that among the proposals in the Senate are a further extension of the grace period to between seven and 10 years.
“Or it can still be five years, but subject to extension by the Department of Environment and Natural Resources (DENR), the Fiscal Incentives Review Board (FIRB), or the Department of Trade and Industry (DTI),” Mr. Escudero said.
Asked to comment, Chamber of Mines of the Philippines (CoMP) Executive Director Ronald S. Recidoro said a ban on the export of raw mineral will have “far-reaching negative effects on the mining industry and those that rely on it for their livelihood.”
“While the proposal is well-intentioned, it is poorly suited to the current realities of the Philippine minerals development sector. Our country lacks the infrastructure, energy cost advantages, and policy consistency required for the success of similar bans in other countries, such as Indonesia,” he said via Viber.
“Without addressing these fundamental challenges, an export ban is likely to exacerbate existing issues rather than catalyze growth in domestic processing and value-adding industries,” Mr. Recidoro added.
In a joint statement issued previously, the CoMP and the Philippine Nickel Industry Association said a ban on ore exports could lead to further mine closures and an increase in unemployment.
Additionally, Mr. Escudero called on the DENR to review inactive, non-operational, invalid or unused mining exploration permits and Mineral Production Sharing Agreements (MPSAs).
“There are exploration permits and MPSAs that are not moving; they do not benefit the nation or to Filipinos,” he said.
Mr. Escudero added that the DENR should revoke unutilized exploration permits or MPSAs issued to individuals or companies.
“If you do not fulfill the agreed upon tasks within the specified time, your exploration permit or MPSA should be revoked and canceled… They are mere contractors. Any grantees of exploration permits or MPSAs are mere contractors of the state over an asset that is owned by the state,” he said.