Mining in the Philippines

1. OVERVIEW

The Philippines is a mineral-rich country situated in the Pacific rim of fire. Its volcanic islands boast of millions of hectares of prospective mining lands. Yet, these vast mineral resources have remained untapped for many years due to a variety of socio-economic, legal and environmental reasons.

But today, realizing the potential of the mining industry and the key role it can play in jumpstarting the weakening Philippine economy, the government has embarked on programs to revitalize the industry that aims to balance mining development with socio-environment concerns.

The mining industry has been given new groundwork to carry out its role in the economic expansion of this nation. Mining projects will contribute substantially to poverty alleviation, particularly in the countryside, and to the overall economic growth of the Philippines. Mineral wealth is estimated at $1 trillion – 12 times its annual gross domestic product.

In 1996, according to the Mines and Geo-Sciences Bureau (MGB), the mineral reserves in the Philippines comprised of 6.67 billion metric tons of metallic minerals, and 78.74 billion metric tons of non-metallic minerals.

One of these vast resources of minerals is Magnetite Iron Ore. These mineral deposits are the primary source of raw materials of iron ore – iron ore being the basic material used in cast iron and steel. Magnetite iron ore comes in the forms of ‘iron fines’, ‘lumps’ and ‘iron pellets’.

The Philippines was one of the major suppliers of raw materials for steel production that radically contributed to the industrialization and development of Japan.

However from 1974 onwards, mining activities started to decline with the prices of magnetite iron ore dropping worldwide owing to the excess production of certain countries in the world market. The situation worsened with the Philippine Government’s ban on ‘Beach Mining’ and ‘Off-shore Mining’ due to the irresponsible and improper mining practices.

Currently, there is no active mining of these minerals in the Philippines

2. LIFTING OF THE BAN

Realizing the potential of the mining industry and the key role it can play in jumpstarting the weakening Philippine economy, the government has embarked on programs to revitalize the industry that aims to balance mining development with socio-environment concerns. 

The mining industry has been given new groundwork to carry out its role in the economic expansion of this nation.  Mining projects will contribute substantially to poverty alleviation, particularly in the countryside, and to the overall economic growth of the Philippines.  Mineral wealth is estimated at $1 trillion – 12 times its annual gross domestic product. 

In January 16, 2004, President Gloria Macapagal Arroyo issued Executive Order No. 270 that provides for a set of principles that will govern the revitalization of the mining industry in the country.  These guiding principles for responsible mining follow the triple bottom line of sustainable development which are: 

• Economic development,
• Environmental protection and
• Social equity  

The Department of Environment and Natural Resources or DENR, in collaboration with other national agencies, have formed the Minerals Action Plan or MAP that will make operational Executive Order 270, and will address the specific obstacles related in the revitalization of the mining sector.  The DENR is tasked to oversee and monitor the implementation of the Minerals Action Plan.  

This lifting of the ban on off-shore mining in 2004, and later in 2005 on ownership of foreign companies by a Supreme Court ruling, has allowed, once again, foreign companies to operate in the country.  

World consumption of iron in crude steel form has progressively been increasing since 1999 after the Asian crisis.  Most of the Asian economies with the foremost influence from China have dominated the iron market scenario.  In fact, in the not too distant future, the Philippines foresee owning a huge share in the supply of iron ore for the world market.  

3. WHY THE PHILIPPINES

First, it’s strategic location at the heart of Asia.

Second, President Gloria Macapagal Arroyo has pledged her unwavering support for the
revitalization of the mining industry in the Philippines as mandated in Executive Order 270 in the year 2004. Coupled with the firm commitment of the DENR, in the strict implementation of the Minerals Action Plan. Protection of the environment will be of paramount consideration in every stage of a mining operation. Mitigation and progressive rehabilitation measures will be integral components of mining operations.

Moreover, the Arroyo Administration has pledged to maintain fiscal and non-fiscal incentives for the mining sector to attract foreign capital and accelerate the development of the country’s mineral resources.

Third, the Philippines has an ample resource of highly-skilled workers.

Fourth, this human resource is accessible at a lesser cost. The rate of skill levelled workers in the country is quite inexpensive, making it exceedingly attractive to foreign investors. The revitalization plans of the government for the mining industry has a promise of over 600,000 jobs for the Filipino worker.

4. WHY COLOSSAL MINING CORPORATION

COLOSSAL MINING CORPORATION holds APPROXIMATELY 80% OF OFFSHORE MAGNETITE IRON ORE SITES IN THE COUNTRY.

With the abovementioned development COLOSSAL Mining Corporation had prompted to take the initiative to revisit and reinterpret data that was initially conducted by the Mines and Geosciences Bureau (MGB) in collaboration with CCOP (Coordinating Committee for Offshore Prospecting)/UNDP (United Nations Development Program)/ESCAFE (Economic Commission for Asia and the Far East) under project RAS/86/138 which covers the northwestern Luzon offshore. Worth remarkable on the survey conducted is the data gathered along Lingayen Gulf where an economical detrital magnetite deposits has been delineated.

COLOSSAL Mining Corporation ventured into offshore mining and holds APPROXIMATELY 80% OF OFFSHORE MAGNETITE IRON ORE site in the identified magnetite iron ore potential in the North Western Luzon Offshore, Lingayen Gulf and the Province of Cagayan. These potentials are reported and published at the CCOP/UNDP Technical Bulletin and several MGB technical reports.

In the Lingayen Gulf alone, the computed magnetite reserves are 572 million cubic meters or 2.9 billion tons. Using an average grade of 60% iron, the iron reserve is approximately 1.70 billion tons which translates to approximately US$68 billion based on the 2004 pellet price of US$40 per metric ton.

President Gloria Macapagal Arroyo has clearly and explicitly defined her desire for the
revitalization of the Mining Industry in this country.

Colossal Mining Corporation has heeded that call, and Colossal has made it a corporate battlecry to be greatly instrumental in the rehabilitation and renovation of the Mining Industry in this nation.

The demands in the world market are crying out for a fresh resource. The TIME IS NOW to satisfy that cry.

PARTNER WITH US. And help us REBUILD THE MINING INDUSTRY IN THE PHILIPPINES, TO MAKE IT GREAT AGAIN….

 

PRESS RELEASE

December 15, 2006