Protests mar Lepanto mine takeover by African firm

MANKAYAN, Benguet -- Indigenous elders in this mining town voted to allow South African mining giant Gold Fields Ltd. to proceed with and assume majority control over one of the biggest gold and copper mining ventures in the country even as oppositionists rallied and protested the entry of the mining firm.

The National Commission on Indigenous Peoples (NCIP) oversaw the process of securing the free prior and informed consent (FPIC) of 400 Mankayan elders in eight villages in Saturday’s voting.

Republic Act No. 8371 (Indigenous Peoples Rights Act of 1997) requires all government and private development projects to inform and secure clearance from indigenous Filipinos living in areas that these undertakings intend to exploit.

Gold Fields partnered with Lepanto Consolidated Mining Co. (LCMC) to develop the Far Southeast porphyry ore deposit. LCMC, which started operations in 1936, owns 60 percent of the Far Southeast gold project.

Major investment

The project is considered a major mine investment because of the capitalization needed to develop the ore and the projected profits it would generate, according to Felizardo Gacad Jr., chief of the mine environment and safety division of the Mines and Geosciences Bureau in the Cordillera.

In its website, LCMC said: “The updated mineral resource of the Far Southeast porphyry copper deposit at a cutoff grade of 0.7 percent Cu (copper) equivalent is 657 million tons grading 0.65 percent Cu and 0.94 g/t (grams per ton) Au (gold). At a cutoff grade of 1.5 percent Cu equivalent, the mineral resource is 180 million tons at 0.80 percent Cu and 1.70 g/t Au.”

It said the estimated ore reserve, at a cutoff grade of 1.5 percent copper equivalent, is “120 million tons grading 0.80 percent Cu and 1.5 g/t Au.”

The Philippine Rural Reconstruction Movement (PRRM), in an online report on the country’s mining potential, identified Far Southeast in Benguet, Didipio in Nueva Vizcaya and Dizon Extension in Zambales as among the major gold-copper deposits in the country.

The Mankayan community approval allows Gold Fields to infuse 20 percent more into the project, increasing its stake from 40 percent (valued at $220 million) to 60 percent by buying $110-million worth of shares from LCMC.

The elders, representing the villages of Colalo, Cabiten, Bulalacao, Paco, Poblacion, Sapid, Suyoc and Tabio, were asked to decide whether they would allow the project’s investors to convert two portions of their mineral production sharing agreements into an FTAA (financial and/or technical assistance agreement), said Bernadette Badecao, NCIP Cordillera team leader who administered the FPIC process.

The NCIP said 283 elders voted in favor of the project while 51 others rejected it.

Following the vote, the villages would also select elders who would negotiate on their behalf for royalty terms in a proposed memorandum of agreement with the mining company, said AmbrosioGuanso, leader of the Mankayan Ancestral Domain Indigenous Peoples Organization.

Picket

At noon on Nov. 29, a picket mounted by members of antimining group Save Mankayan Movement (SMM) in front of the municipal hall turned violent. The protesters, however, were pacified later by police and Army soldiers.

Two previous FPIC consultations were also disrupted by SMM.

“I was almost punched by a protester whose wedding I even officiated. Another one was also set to throw a rock at me,” said Mankayan Mayor MaternoLuspian, who voted as an elder of Poblacion village.

Earlier, 31 elders from Barangay Bulalacao sent a petition urging fellow elders not to approve the project. Those from Barangay Upper Tabeo also filed a petition in the NCIP questioning the FPIC process, saying it was biased.

The SMM, through another petition, asked the NCIP to void the FPIC and the votes cast on Nov. 29.

Magellan Bagayao, LCMC resident manager, said the project would revive the economy of Mankayan.

“With the coming in of Gold Fields we could address the problem on unemployment and also the business sector will also benefit, and not only that, over all the government will also share from the National Wealth Tax,” Luspian said.

“The groups have agreed in principle 80 percent of the project’s employment will come from the municipality and its environs.If not qualified, then we train them. If ever they (FSGRI) would come up with  capability building as recommended. They could start with women’s groups, senior citizens, the youth and give them skills development.  So that just in case they come in, they will know who are the people to hire and people that they will train. People are now opening their eyes with Gold Fields under the Far South East project,” the mayor said.

Luspian said, he is looking on three aspects that the mining company must satisfy -- legal, social, and environmental.

Gold Fields signed an 18-month option and shareholder’s agreement with Lepanto and Liberty Express on September 2010.

Gold Fields is the 4th largest mining company worldwide, it aims to be “the global leader in sustainable gold mining”, with its official motto as “if we cannot explore safely we will not explore; if we cannot mine safely we will not mine”.