MGB lifts moratorium on mining permit applications

The Department of Environment and Natural Resources (DENR) has lifted the moratorium on applications for mining permits it imposed two years ago.

Starting Monday, March 18, the department's Mines and Geosciences Bureau (MGB) will again be accepting applications for Exploration Permits (EPs) and Financial or Technical Assistance Agreements (FTAAs).

Environment Secretary Ramon Paje approved the memorandum dated March 7 and submitted by MGB Director Leo Jasareno seeking an end to the moratorium.

The moratorium was imposed in January 2011 as the DENR ordered the MGB to review pending and inactive mining projects in the country.

The suspension covered applications for EPs, FTAAs, and Mineral Production Sharing Agreements (MPSAs).

An MPSA is a mineral agreement (MA) in which the government shares in the production of the contractor. Applications for MPSAs are still not allowed as Executive Order No. 79, the new mining policy issued last year, stipulates that "no new mineral agreements (MA) shall be entered into until a legislation rationalizing existing revenue sharing schemes and mechanisms shall have taken effect."

An FTAA is a mining right granted for large-scale operation, development and utilization of minerals. It allows 100-percent foreign ownership of a venture, with 50-50 revenue-sharing with the government.

EPs may now be issued because the MGB has completed the mapping of no-go zones—areas where mining activities are prohibited or restricted because they are dedicated solely to agriculture and tourism activities or are protected areas. EO 79 required the no-go zones to be mapped before EPs could be issued.

The Chamber of Mines of the Philippines (COMP) welcomed the lifting of the moratorium. “[It] is indicative that government has laid the groundwork required under Executive Order No. 79 to promote the rational exploration, development, and utilization of the country’s mineral resources. It also shows that government is responding to the mining industry's call for a stable policy and investment environment needed by investors," it said.

Fee increase

The DENR recently raised the filing fees for all mining applications as stipulated under the new mining policy.

The application fee for an EP was raised to P300 per hectare but not less than P200,000 per application (from P60 per hectare but not less than P50,000 per application).

For an MA, the application fee is P300 per hectare but not less than P300,000 per application (from P60 per hectare but not less than P50,000 per application).
 
For an FTAA, the fee is P300 per hectare but not less than P500,000 per application (from P60 per hectare but not less than P100,000 per application).

The DENR also raised the minimum capital requirements for companies applying for mining permits from P10 million to P100 million for authorized paid-up capital and from P2.5 million to 6.25 million for paid-up capital.

For a company to go for an FTAA, which will be granted by President, it must have a paid-up capital of P500 million before it registers with the MGB.

All mining applicants with pending applications must comply with the new payment regulation within 60 days.

Jasareno earlier said the higher fees will help "weed out" speculators who use mining applications and permits to influence stock prices, only holding on to their mining rights and not developing their tenements. — BM, GMA News