Government opposition to Tampakan mine project to send negative signal to investors

MANILA, Philippines - The government’s opposition to the $5.9 billion Tampakan copper and gold mine project in Mindanao is seen to send negative signals to foreign investors, an economist said.

Ramon Clarete of the University of the Philippines-School of Economics said the decision of the Department of Environment and Natural Resources (DENR) to not allow the project to commence operations might drive investors away.

“They (government) just changed the rule in the middle of it. It’s not good because it will send signals to investors that this is not a good country to do business with, and we lost almost $6 billion,” Clarete said during the recently-concluded Mining Philippines Conference 2016.

The Tampakan project in South Cotabato is considered as potentially the country’s biggest foreign investment and believed to be one of the largest gold prospects in the world.

Environment Secretary Gina Lopez earlier said it was former president Benigno Aquino III who issued the environmental compliance certificate (ECC) for the Tampakan project, which covers an area of around 10,000 hectares spanning four provinces.

“The project should never have been given an ECC. DENR did not really want to issue the ECC. But it was brought up to the President and they mandated the ECC,” Lopez said.

But, the project has been put on hold since the province of South Cotabato banned open-pit mining in mid-2010.

Clarete noted that if the Tampakan operations started four years ago, it could have made a positive impact in terms of investments for the country.

The Tampakan mine project was supposed to start operations in the next two years, as part of the aggregate $14.75-billion investments for 2018.

The mine reportedly has an estimated 2.94 billion tons of mineral resource containing 15 million tons of copper and 18 million ounces of gold.

It is projected to produce 375,000 tons of copper and 360,000 ounces of gold per year in the initial mine-life of 17 years, with potential for mine-life extension.

Value of the mine’s production is estimated at $37 billion over a period of 20 years.

Clarete noted that if the Tampakan operations started four years ago, it could have made a positive impact in terms of investments for the country.

The Chamber of Mines of the Philippines (COMP), meanwhile, urged the government to move forward and prepare for future investments in the local mining sector.

According to COMP, over $30 billion in investments have been lined up over the next five to 10 years.

Clarete also cited the need for a transparent policy regulatory regime for mining investments.