Philippines Shuts More Nickel Mines on Environment CrackdownBy
Berong Nickel operations in Palawan suspended, Jasareno says
Goldman predicts prices will climb to $12,000 in six months
The Philippines suspended the operations of Berong Nickel Corp., adding to the list of miners that the government has shuttered for failing to meet environmental and welfare standards, the mines bureau said.
Mining in the Autonomous Region in Muslim Mindanao in the south of the country has also been halted as authorities start to review company permits, according to the Philippine Daily Inquirer on July 15, citing an order from the Department of Environment & Natural Resources in the region.
Nickel has jumped about 9 percent this month on supply concerns after Gina Lopez, hired by new President Rodrigo Duterte as environment secretary, began an audit of all mines and imposed a moratorium on approval of new projects. The Philippines is the world’s biggest source of nickel ore, and supplies almost all of the material imported by China to make stainless steel.
Goldman Sachs Group Inc. estimates that a quarter of existing nickel mine output from the country will be lost from the market for the next six months, the bank said in a July 11 report, predicting that prices in London will rise to $12,000 a metric ton in six months, compared with $10,285 on Monday.
Berong Nickel’s suspension was because of its failure to control river siltation in Palawan province, Mines & Geosciences Bureau Director Leo Jasareno said in a phone message Monday. The company shipped 868,000 dry tons of ore in 2015, compared with total Philippine shipments of 32.3 million tons, bureau data show. A definition of siltation is the accumulation of fine mineral particles in water. A call and message to Jasareno’s phone requesting comment on the Inquirer report were not answered.
Lopez, who has expressed her dislike of mining, said at the start of July that the audit would be completed in three to four weeks and may result in mines being closed in the next six months. Her order effectively extends a department directive issued under President Benigno Aquino in 2015, which gave miners until April to be ISO 14001-certified. The result of the first audit has not been released by the mines bureau.
Nickel Asia Corp. and Global Ferronickel Holdings Inc., the nation’s top two producers, have said they operate according to the standards demanded by their new regulator. The Environment Department this month suspended two operations in Zambales province, north of the capital, for violations of mining and environmental law, its website says.
Some $20 billion to $30 billion of mining investments have been lined up over the next five to 10 years, including the Tampakan copper-gold project in South Cotabato province. These investments would mean $2 billion in additional government export receipts and about $50 million in annual revenue from higher production and exports, according to data from the Chamber of Mines.
The Tampakan project was due to start commercial operations in 2016, but was stalled when the local government of South Cotabato banned open-pit mining.
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