Mining and oil stocks plunge 7.31% as Lopez accepts DENR post

Mining and oil shares plunged again Wednesday on the Philippine Stock Exchange, on news that anti-mining advocate Regina Paz "Gina" Lopez accepted the Cabinet position President-elect Rodrigo Duterte offered.

Starting June 30, Lopez will sit as the secretary of the Department of Environment and Natural Resources (DENR), which holds policy and regulatory powers over the mining industry.

The 17-stock Mining and Oil index plunged 837.14 points or 7.31 percent to 10,614.70.

This compares with the 10.86 points or 0.14 percent decline of the benchmark PSEi at 7,756.370.14.

"Investors were focused on mining and oil stocks, given the new development that there's going to be an appointment of a new secretary. The appointed secretary is a known anti-mining advocate who caused fears among investors exposed in mining and oil," said Astro C. del Castillo, managing director at First Grade Finance Inc.

Lopez accepted the offer late Tuesday, saying it was "an opportunity to make something good happen to this country."

"This confused investors given that the incoming President said he was open [to mining] as long as Canadian and Australian models are followed, but somehow appointed a staunch advocate of anti-mining," Del Castillo said.

The Mining and Oil index was also down 4.09 percent on Tuesday after the announcement that Lopez was offered the post.

Asked to comment on the matter, Lopez was unfazed by what happening now.

"That's good because they are making money out of the suffering of the people. You don't want to build an economy based on the suffering of the people. That's what mining does," Lopez said.

"It puts out fishermen and farmers at risk and I've seen it. I know it. And I've been there. Is that the kind of economy you want to build? It's just not right," she added.

The industry did not take well to her statement.

"Personally, I think the comment is unfortunate, because I have seen responsible mining companies do the opposite – they create economic opportunities in far-flung areas by providing jobs and sustaining SMEs," Ronald R.S Recidoro, vice president for Legal and Policy of the Chamber of Mines of the Philippines said.

"That's precisely why the poor congregate around mining projects – there's the possibility of employment. But that's my personal opinion. The Chamber will come with its own statement on matter," he said.

Incoming Cabinet officials of the Duterte administration noted that compliant mining firms should have no problem with Lopez when she assumes her post the DENR.

"We just have to abide by it. Big mining companies that are compliant will have no problem with her... Those who have shortcuts will have a problem with her because she is very strict in environmental compliance," incoming peace adviser Jesus Dureza said in a television interview. – VDS, GMA News