Paje plans major reform in mining sector

MANILA, Philippines - Environment and Natural Resources Secretary Ramon Paje is set to implement a major policy reform in the mining sector before the year ends.

In an exclusive interview following a speech at the Bulong Pulungan sa Sofitel yesterday, Paje said the DENR, through the Mines and Geosciences Bureau (MGB), is drawing up an administrative order and its implementing rules and guidelines for the conduct of a public bidding for the grant of mining tenements.

Paje explained that instead of the current “first-come, first-served” basis, the DENR-MGB would shift to a public bidding system, initially for the grant of previously cancelled tenements.

Paje noted that out of 2,800 tenement holders, only 30 are actually engaged in mining operations. This indicates that the majority of tenement holders are only speculating or are selling shares in the local stock exchange, he added.

According to Paje, the planned reform would weed out “speculators and claim-jumpers.” He expressed hope that the public bidding system would be in place before the year ends.

Paje said he is also looking at ways to enable indigenous peoples to truly utilize mineral resources in their ancestral domain.

He pointed out that while IPs have the prior right on their ancestral rights, most of the IPs do not have the capacity to mine their mineral resources. What is happening is that moneyed investors merely secure “free and informed consent” from the IPs and take over the exploitation of the mineral resources, granting the IPs only one percent of gross income.

Paje feels the DENR should work on really educating the IPs on how they can directly be involved in the development and exploitation of their mineral resources, similar to the system that American Indians enjoy and which have enabled them to be reap huge financial benefits.

Meanwhile, Paje said the DENR continues to encourage potential investors to put up an integrated iron and steel facility in the country, assuring them of the necessary iron ore which the country currently exports directly to China.

Paje pointed out that the current steel making facilities of Global Steel in Iligan, Davao has not been able to do a backward integration and is instead relying on continued imports of steel bars for use in its hot- and cold rolling steel facilities.