LISTED copper-gold miner Philex Mining Corp. faces additional penalties for possible violations of various environmental laws, even as the company has already received formal notice from the mines bureau of a P1.034 billion fine for the waste spill at its Padcal project site in Tuba, Benguet, government officials said on Thursday.
“We will look at all possible environmental violations and not only the Clean Water Act,” Environment Undersecretary Demetrio L. Ignacio, presiding officer of the Pollution Adjudication Board (PAB), the body assigned to determine the firm’s penalties and liabilities apart from its Mining Act violations, said in a text message.
The mining firm had closed its Padcal mine in Benguet last August 1 after a break in its tailings pond caused a leak of excess water and sediments from the facility into the bodies of water adjacent to the site.
Ignacio said PAB’s assessment is still ongoing.
“PAB is still waiting for the regional report. We instructed EMB’s (Environmental Management Bureau) regional office to fast-track the completion of the report,” he explained.
“I want the Philex case decided in the next two to three weeks.”
In a separate text message to reporters, EMB director Juan Miguel T. Cuna said the agency was “almost done” with computation of fines to be imposed on the company arising from its alleged violations of Republic Act (RA) No. 9275, or the Philippine Clean Water Act of 2004, and the terms of its environmental compliance certificate (ECC).
He declined to give an estimate, saying only: “Under the Clean Water Act, it will be at P200,000 per day at a maximum. For ECC, the penalty will be P5,000 per violation of the certificate’s terms.”
The Clean Water Act bans the discharge of waste materials beyond prescribed regulatory levels into bodies of water.
Fines ranging from P10,000-P200,000 can be imposed for everyday of the violation, while failure to undertake clean-up operations can be punished by two- to four-year jail terms and a fine not less than P50,000 per day of violation.
Mines and Geosciences Bureau (MGB) director Leo L. Jasareno told reporters on Thursday, however, that the PAB will still convene to decide on these penalties, as well as determine any liability on the part of Philex Mining.
“The MGB’s report covers only the extent of the leak. The liability aspect is still under investigation,” he explained.
The mines bureau on Wednesday had served the miner official notice of its fine for its violation of RA No. 7942, or the Philippine Mining Act of 1995, through a letter which the firm received at 5:15 p.m. that day. Firms are mandated to pay P50 per tonne of solid discharge under the Mining Act.
Philex Mining was fined P1,034,358,971 for the discharge of 20,698,179.42 metric tonnes of waste, and has been given seven days to comment on the bureau’s report on the incident.
“We gave them seven days to comment to give them a chance, as part of due process afforded to them by law. They can present evidence and refute the report. Once they submit their comment, we’ll give ourselves seven days to deliberate. After we make a decision, then they’ll have 15 days to comply,” said Jasareno.
“Their payment, if they will be required to make any, will go straight to the National Treasury.”
Philex Mining said in a disclosure on Thursday that it will contest the imposition of the tailings fee, arguing that “it is grossly unfair to penalise Philex and impose a huge fine on it when the government agency imposing the fine itself has confirmed that Philex is just a victim of force majeure event or an act of nature over which it had no control.”
Jasareno, however, explained yesterday that there is no provision under the law that says a tailings fee can be imposed only if the spillage is intentional or a result of negligence, among others.
“Under the Mining Act, your tailings must be fully contained within the pond. From a technical point of view, Philex was not able to do that, and therefore must pay. There is no provision in the Mining Act qualifying that the tailings fee could be waived in case the spill is caused by force majeure. It just says that tailings must be 100 percent contained,” said the official.
“Our team also computed the volume of the sediments using Philex’s own software,” he noted.
He added that MGB, though its letter to the miner, had also sought comment on its own findings on the firm’s operations.
“Our report, which we furnished Philex, noted that monitoring of the tailings pond’s penstocks and drainage tunnels was done only once a year, among others. There is no prescription under our current laws on this (monitoring), no clear-and-fast rules,” Jasareno said.
The MGB chief also said that the firm will not be able to operate unless it is able to settle fines and other liabilities resulting from the incident and complete the appropriate remedial efforts.
Michael T. Toledo, Philex Mining senior vice-president for corporate affairs, reiterated in a statement that the company continues its rehabilitation of areas affected by the spill. “Philex contesting the unfair imposition of the fine will not in any way affect its fundamental commitment to remediate the effects of the spill on the environment and surrounding communities even if caused by an event outside its control.”
The firm’s shares fell 18 centavos or 1.21 percent to P14.70 apiece at the end of trading on Thursday.
Philex Mining is partly owned by Hong Kong-based First Pacific Co. Ltd, which also has a stake in Philippine Long Distance Telephone Co (PLDT). Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary Mediaquest Holdings, Inc., has a minority stake in BusinessWorld.