Marcventures Lead Philippine Miners Lower After Duterte Warningby
President-elect Duterte warns mining companies on environment
Mindanao mine development should be done by locals: Duterte
Marcventures Holdings Inc. and Global Ferronickel Holdings Inc. sank on concern Philippine miners in Mindanao will face closer scrutiny after President-elect Rodrigo Duterte warned companies whose operations threaten the environment to upgrade their practices or face closure.
Marcventures fell 4.3 percent at 2:59 p.m. in Manila, poised for the lowest close since Feb. 12. Global Ferronickel declined 2.2 percent, its first loss in five days. The shares dropped even as the benchmark Philippine Stock Exchange Index advanced 1.1 percent.
Duterte, who hails from the Philippines’ island of Mindanao, said on Saturday miners have to stop practices that destroy the environment. He used Surigao as an example of how a mineral-rich region in the northern area of Mindanao suffered calamities that environmentalists say were worsened by mining. At stake is an island that’s estimated to sit on $300 billion worth of mineral deposits, from nickel, copper to gold.
“Some investors are speculating that mines in Mindanao will face stricter hurdles because of Duterte’s pronouncements,” said James Lago, head of research at Manila-based PCCI Securities. “There will be speculation until these erring miners are named.”
Both Marcventures and Global Ferronickel have mines in Mindanao’s Surigao region. Duterte, who starts a six-year term on June 30, also said locals of Mindanao must get first crack in extracting the island’s mineral deposits.
Half of the nation’s 44 operating metallic mines have been repeatedly warned to comply with environmental protection measures, Mines & Geosciences Bureau Director Leo Jasareno said on Monday in an interview with DZMM radio.
Philex Mining Corp. , the nation’s biggest publicly-traded metals company, swung between gains and losses. Philex, a unit of Hong Kong’s First Pacific Co., is seeking partners to help fund the $1 billion to $1.2 billion it needs to develop Silangan, a copper and gold project in the province of Surigao del Norte that it targets to start production by 2018.
Philex President Eulalio Austin, Global Ferronickel President Dante Bravo and Marcventures President Isidro Alcantara weren’t available for comment.