Philippines’ Duterte holds open pit mining ban despite pressure

Camp at Tampakan copper-gold project on Mindanao Island, southern Philippines. (Image: Sagittarius Mines.)

Philippines’ President Rodrigo Duterte has refused to lift a ban on new open-pit mines, despite facing pressure from members of his government, including the current environment minister.

“I personally asked the President if there’s been a change in policy,” Harry Roque, Duterte’s spokesman said Monday according to the Inquirer. “And he says there’s still no new policy on this; there’s still a ban on new open-pit mining.”

Ban threatens major planned mines, including Sagittarius Mines’s $5.9bn Tampakan gold-copper project, which could become the Philippines’ largest mining operation and one of the world’s biggest copper mines.

The existing measure only affects projects, not mines currently in operations, though former environment minister Regina Lopez did prohibit open pit mining during her 10 months in office. The ousted ecologist, who shut down many of the country’s mines, believed the ban would reduce the environmental damage allegedly caused by the industry, helping preserve the “economic potential” of the country.

But the continuity of the ban in the Southeast Asian nation, the world’s top nickel ore exporter, threatens major planned mines such as Philex Mining’s $2bn Silangan copper-gold project in Surigao del Norte.

It would also affect Sagittarius Mines’s $5.9bn Tampakan gold-copper project in South Cotabato, which has the potential to become the Philippines’ biggest foreign investment. The project, formerly owned by Glencore, is set to become the Philippines’ largest mining operation and one of the biggest copper mines in the world with estimated annual production of 375,000 tonnes of copper and 360,000 ounces of gold over its 17-year life.

Duterte’s decision not only ignores demands from pro-mining groups but also from members of his own government, including Roy Cimatu, a former military chief who replaced Lopez in May and was confirmed in the post in October.

The Mining Industry Coordinating Council (MICC), an inter-agency panel that makes recommendations on policy for the sector, has also requested the government to lift the ban.

Prices for nickel, the main mining export from the Philippines, lost 0.2% to $11,550 a tonne on the news. The metal had gained this year from expectations of higher demand due to its use in electric vehicles, but concerns over high levels of available material have slowed down the price increase.

Philippines' Duterte holds open pit mining ban despite pressure

BMI Research said in a note Monday it expected nickel miners to witness subdued output growth in the coming years as operational difficulties come to the fore and low prices reduce profit margins.

“Major nickel miners with a high degree of diversification will continue to improve balance sheets as they benefit from higher prices of other metals, while those that are more exposed to nickel stand to lose out,” the analysts wrote.


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