Southcot To Doe And Mining Firms: Don't Bypass Us

SouthCot to DOE and mining firms: Don't bypass us

Written by Allen V. Estabillo/MindaNews

14th November 2006

GENERAL SANTOS CITY - Local officials in South Cotabato have censured the Department of Energy (DOE) and the three mining companies exploring the coal deposits in the mountains of Lake Sebu town for bypassing the authority of the provincial government over the proposed large-scale coal mining development project in the area. South Cotabato Gov. Daisy Avance-Fuentes said the failure of the DOE and the mining firms Daguma Agro-Minerals Inc., Bonanza Energy Resources Inc. and MG Mining and Energy Corporation to even inform them about their operations in the coal-rich Barangay Ned, Lake Sebu is a clear violation of the Local Government Code. "The law provides local government and stakeholders to be properly consulted and informed about these kind of activities based on the principles of local autonomy," said the governor.

Aside from the provincial government, the departments of Agrarian Reform and even the the Environment and Natural Resources were not aware about the coal explorations.

Fuentes said Daguma and its sister firm Bonanza did not exert any effort to notify the provincial government about their activities in Barangay Ned, Lake Sebu since they obtained their coal operating contract (COC) for exploration from DOE in November 2002 and May 2005, respectively.

She said her office first received reports about the coal mining explorations in the Barangay Ned, which is part of the mineral-rich Daguma Mountain Range, when a road leading to the area was partially opened last year.

Fuentes said she sent letters to the DOE seeking clarifications about the project. It took several months for the department to respond to them.

The Provincial Development Council (PDC) and the Provincial Board launched a joint inquiry last week on the coal explorations, which are meeting strong opposition from local residents, the Catholic Church and several non-government organizations.

The inquiry was attended by a representative of the DOE, executives of the three mining companies and stakeholders of the proposed mining area. Levi Toquero, Daguma's project development consultant, admitted during the inquiry that the company deliberately withheld information to the area's local governments about their operations in Barangay Ned when they began in 2002 as they were not certain about the viability of the project then.

He said it was not their intention to ignore the authority of the local governments in the area.

"We would like to apologize for not reporting to you in the past. We were silent because only one mine can come out in our 300 prospects and we don't want to give you any false hopes," he said.

Daguma, headed by former Vice President Teofisto Guingona's brother Benjamin, is now winding up its explorations and has been preparing for a "multimillion coal development and production project" covering a 300-hectare mining area. Toquero said the company's explorations revealed a potential mine resource of 100 million metric tons that is reportedly good for a 50-year mining operation. He said the company, which is financed by United Kingdom-based firm Crew Gold Corporation, plans to pour in at least US$70 million worth of investments in the area during the next decade.

The DOE's representative Ruel Malapitan said the agency may not have properly consulted and informed the local governments in the area about the proposed coal mining projects since they are considered as national government initiatives.

He stressed that coal mining projects are covered by the Presidential Decree (PD) 972 as amended by PD 1174 or the Coal Development Act of 1976. Malapitan said such law "promotes the accelerated exploration, development, exploitation, production and utilization of coal."

It also introduced the coal service contract system and established the appropriate guidelines for coal operations in the Philippines, he said.

But lawyer Elpidio Feria, legal counsel of the Social Action Center-Justice and Peace Desk of the Diocese of Marbel, said the DOE should have considered the provisions of the Local Government Code when they approved the coal mining projects.

"They are using a law that is approved during the time of (former President Ferdinand) Marcos and the Local Government Code already superseded it when it comes to the principle of local autonomy," said Feria, who represents the Justice and Peace Desk in the PDC.

Fuentes, also a lawyer, said she will personally study various laws regarding the matter and determine if the DOE and the coal mining companies violated some laws.

She said the PDC will also seek opinions from legal and technical experts knowledgeable about coal mining operations before making a decision on whether they would endorse or oppose the proposed mining ventures. (Allen V. Estabillo/MindaNews)