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Citinickel's Pulot Sofronio mine in Palawan, Philippines


Description:

On March 01, 2007, the Citinickel Mining and Development Corporation (CMDC) was granted two mining concessions in Palawan; one of them is the Pulot Sofronio mine, located in Barangay Pulot, nearby Sofronia Espanola town [1], covering an area of 1,408ha [2]. Palawan has a special law, the Strategic Environment Plan for Palawan Act RA 7611 that establishes a development framework in the province and should regulate economic activities, such as mining, in environmentally critical areas. Mining started in 2010, promising progress to the communities; but instead of progress, the mine brought large destruction to the island [3]. According to Queron, secretary of the local indigenous organization PKP, “Since 2010, the operation of Citinickel destroyed the environment, our livelihood, health, and culture [… ] because of this, we are being pushed deeper into poverty” [3].

According to PKP, the required Free Prior Informed Consent (FPIC) and the related Memorandum of Agreement (MOA) was obtained in violation of indigenous rights. Moreover, according to PKP, Citinickel did not even comply with the MOA, as the company did not pay agreed royalties; neither have they paid for the damages caused to their ancestral lands, rivers and crops. But the indigenous people do not want them anymore to pay royalties, but rather they want CMCD to leave the area and stop mining [3].

Following a large silt spill on June 5th, 2014 [4], the Mines and Geosciences Bureau (MGB) suspended operations of CMDC on June 2014 and CMCD were fined to pay 3 million pesos for 14 days of pollution of water bodies, due to violation of the Clean Water Act of 2004 [5]. The Pasi and Pulot River were heavily poisoned by the chemicals [3;6] and the group Kalikasan PNE, who organized in response an environmental investigation mission (EIM), spoke of a potential biological death of the rivers [7].

However, in an order from the MGB from December 22, 2014, the suspension of the mining activities was lifted and mining operations continued [5]. As part of Citinickel’s long-term development program, the company wants to acquire further mining sites in the area [2]. However, as experienced by the two Citinickel mines, such development, as well as other mining activities in the area, pose continuous risks of further environmental disasters to the communities.

Palawan’s indigenous people continue to strongly oppose the mine operated by CMDC, and on March 23, 2015, thousands of Palaw’ans marched in Sofronio Espanola, to oppose the mining operations [3]. PKP, Alyansa Tigil Mina (ATM), and other environmental groups have urged the MGB to stop the CMDC project [9] and oppose the Mining Act of 1995 [3]. However, it seems that under the pro-mining government of Aquino, environmental justice, will be difficult to be achieved [6].

Basic Data

Name of conflict:Citinickel's Pulot Sofronio mine in Palawan, Philippines
Country:Philippines
State or province:Souther Palawan
Location of conflict:Barangay Pulot, Sofronia Espanola Town
Accuracy of locationHIGH (Local level)

Source of Conflict

Type of conflict. 1st level:Mineral Ores and Building Materials Extraction
Type of conflict. 2nd level:Tailings from mines
Land acquisition conflicts
Mineral ore exploration
Mineral processing
Specific commodities:Land
Iron ore
Nickel, Chromite
Rare metals

Project Details and Actors

Project details

The Pulot nickel mine is one of two mining concessions that Citinickel holds in Palawan, approved by the MGB on 01.03.2007. The second mining site is the Toronto nickel mine, located in Narra, Palawan, around 80km from Sofronio Espanola town; see related conflicts. Citinickel holds in total mining concession over 2,176ha [1].

In 2011, Citinickel was reported to have invested 5.146 billion Philippine Pesos in their mining operations (around 1.16 billion USD) [10].

The mining concession in Pulot covers a land area of 1408 ha [2].

During 2011, around 1 million tons of nickel ore, produced at both mining sites, were shipped and target for 2012 was stated to be 4 million tons [8]. Shipped nickel ore has been of low grade (1%/ton) with 48% iron content [8].

As of March 31, 2014, the main shareholders (>5%) of Oriental Peninsula have been Citimax Group Inc. (33%), Golden Spin Realty, Inc. (29%), PCD Nominee Corp. Filipino (27%), PCD Nominee Corp. Non-Filipino (5%) and Billion Apex Development Ltd. (5%) [2]. In 2013, also King Crown Group Limited and Fuying Holdings Limited were reported to have invested in Oriental Peninsula [2].

According to reports released in 2013 by Oriental Peninsula [2], the PCD Nominee Corporation is a wholly-owned subsidiary of the Philippine Depository and Trust Corporation, Inc. (PDTC). Major capital players involved in the the PCD Nominee Corporation are the Philippine Stock Exchange; (31.75%), Bankers Association of the Philippines (31.75%), Financial Executives Institute of the Philippines (10%), Development Bank of the Philippines (10%), Investment House Association of the Philippines (6.5%), Social Security System (5%) and Citibank N.A. (5%). Major banks involved in the PDTC are Hongkong Shanghai Banking Corp. LTD (15.64%); and Deutsche Bank Manila (12.11%)

The company has planned to construct a smelting plant in Palawan to process their nickel ores from their Palawan operations. Investment size for this was reported to amount to 10 million USD [2].

Project area:1,408
Level of Investment:1,160,000,000 (as of 2011 for all Citinickels mining operations in Palwan)
Type of populationRural
Affected Population:unknown
Start of the conflict:01/03/2007
Company names or state enterprises:Citinickel Mines and Development Corporation (CMDC) from Philippines - mining
Oriental Peninsula Resources Group Inc. (ORE) (ORE) from Philippines - mining
Citimax Group Inc. from Philippines - mining
Golden Spin Realty, Inc. from Philippines - mining
PCD Nominee Corporation from Philippines - investment
Billion Apex Development Ltd. from Philippines - mining
King Crown Group Limited from Hong Kong SAR, China - investment
Fuying Holdings Limited from Hong Kong SAR, China - investment
Philippine Depository and Trust Corporation, Inc. (PDTC) (PDTC) from Philippines
Relevant government actors:Mines and Geosciences Bureau (MGB), Republic of Philippines
Department of Environment and Natural Resources (DENR)
International and Finance InstitutionsThe Philippine Stock Exchange Inc. (PSE) from Philippines
Financial Executives Institute of the Philippines (FINEX) (FINEX) from Philippines
Bankers Association of the Philippines from Philippines
Development Bank of the Philippines from Philippines - banking, finance
Investment House Association of the Philippines from Philippines
Social Security System Philippines from Philippines
Citibank Philippines from Philippines
Hongkong Shanghai Banking Corp. LTD from Hong Kong SAR, China
Deutsche Bank (DB) from Germany
Environmental justice organizations (and other supporters) and their websites, if available:Indigenous organization Pinagtibukang Kaundang-undangan it Palaw’an (PKP);
Alyansa Tigil Mina (ATM);
Kalikasan-People’s Network for the Environment (Kalikasan PNE);
Bigkis at Lakas ng Katutubo sa Timog Katagalugan (BALATIK);
Advocates of Science & Technology for the People (AGHAM);
Kalipunan ng Katutubong Mamamayan sa Pilipinas, Defend Patrimony Alliance;
Task Force-Justice for Environment Defenders;
Katribu Party-list and the Kalikasan Party-list, and others

Conflict & Mobilization

IntensityMEDIUM (street protests, visible mobilization)
Reaction stageIn REACTION to the implementation (during construction or operation)
Groups mobilizing:Farmers
Indigenous groups or traditional communities
Local ejos
Local government/political parties
Neighbours/citizens/communities
Ethnically/racially discriminated groups
Local scientists/professionals
Religious groups
Indigenous Palaw'an
Fisher people
Forms of mobilization:Community-based participative research (popular epidemiology studies, etc..)
Creation of alternative reports/knowledge
Development of a network/collective action
Involvement of national and international NGOs
Public campaigns
Street protest/marches

Impacts

Environmental ImpactsVisible: Biodiversity loss (wildlife, agro-diversity), Loss of landscape/aesthetic degradation, Noise pollution, Soil contamination, Waste overflow, Surface water pollution / Decreasing water (physico-chemical, biological) quality, Groundwater pollution or depletion, Mine tailing spills, Deforestation and loss of vegetation cover
Potential: Air pollution, Food insecurity (crop damage), Soil erosion
Health ImpactsVisible: Other environmental related diseases
Potential: Mental problems including stress, depression and suicide, Health problems related to alcoholism, prostitution, Violence related health impacts (homicides, rape, etc..)
Other Health impactsExposure to contaminated environmental resources
Socio-economical ImpactsVisible: Loss of livelihood, Loss of traditional knowledge/practices/cultures, Loss of landscape/sense of place
Potential: Lack of work security, labour absenteeism, firings, unemployment, Social problems (alcoholism, prostitution, etc..), Violations of human rights, Militarization and increased police presence

Outcome

Project StatusIn operation
Conflict outcome / response:Application of existing regulations
Project temporarily suspended
After a temporary suspension and a fine to be paid by the company, the project was allowed to continue.
Proposal and development of alternatives:Local organisation PKP wants to stop mining in the areas. They have further joined countrywide calls to stop the Mining Act of 1995.
Do you consider this an environmental justice success? Was environmental justice served?:No
Briefly explain:The project goes on.

Sources & Materials

Juridical relevant texts related to the conflict (laws, legislations, EIAs, etc)

Strategic Environment Plan for Palawan Act RA 7611
http://faolex.fao.org/docs/html/phi19797.htm

Philippine Mining Act of 1995
http://www.psdn.org.ph/chmbio/ra7942.html

Philippine Clean Water Act of 2004
http://www.emb.gov.ph/eeid/2010/factsheet/RA%209275.pdf

The Indigenous Peoples’ Rights Act of 1997 (IPRA)
http://www.gov.ph/1997/10/29/republic-act-no-8371/

[4] Rappler online (18/06/2015): "Oriental Peninsula to comply with gov’t on latest Palawan mine spill" (accessed 15/04/2015)
http://www.rappler.com/business/special-report/whymining/whymining-latest-stories/60849-oriental-peninsula-palawan-mine-spill

[5] The Philippine Star online (07/01/2015): "Citinickel Mines allowed to resume operations in Palawan mine" (accessed 15/04/2015)
http://www.philstar.com/business/2015/01/07/1410172/citinickel-mines-allowed-resume-operations-palawan-mine

[6] PIPLINKS online (19/06/2014): "Citinickel and Philex: latest cases of impunity in big mines" (accessed 15/04/2015)
http://www.piplinks.org/citinickel-and-philex%3A-latest-cases-impunity-big-mines

[7] KALIKASAN (03/12/2012): "Death of two rivers in Palawan imminent if Citinickel mining continues"
http://www.kalikasan.net/press-release/2012/12/04/death-two-rivers-palawan-imminent-if-citinickel-mining-continues

[8] The Bellwether report by MAFI (29/06/2012).
http://fami.com.ph/wp-content/uploads/2012/07/Bellwether-1-5.pdf

[9] ATM Press release (12/06/2014) :"Environmental group urges MGB to cancel CMDC operations in Palawan"
http://alyansatigilmina.net/2014/06/12/atm-press-release-environmental-group-urges-mgb-to-cancel-cmdc-operations-in-palawan/

[2] Oriental Peninsula Company website (accessed 15/04/2015)
http://orientalpeninsula.com

[3] Bulatlat online (26/03/2015) "Palawan indigenous people call for stop to Citinickel mines" (accessed 15/04/2015)
http://bulatlat.com/main/2015/03/26/palawan-indigenous-people-call-for-stop-to-citinickel-mines/

[10] The Philippine Star (23/08/2011): "Investments jump 53% to P369 B in Jan-July"
http://www.philstar.com/business/719174/investments-jump-53-p369-b-jan-july

GMA News (June 13, 2014) on the suspension of the mining activities (accessed 23/04/2015)
http://www.gmanetwork.com/news/story/365607/economy/agricultureandmining/mgb-suspends-citinickel-mines-operations-in-palawan

Other documents

[1] MGB document on mining concessions in 2014
https://file.ejatlas.org/docs/1927/MGP_2014_Nov_Complete_List_of____MPSA_2A.pdf

Strategic Environment Plan for Palawan Act RA 7611
https://file.ejatlas.org/docs/1927/a_RA_7611_SEP_for_Palawan_Act.pdf

Strategic Environment Plan for Palawan Act RA 7611 (amended)
https://file.ejatlas.org/docs/1927/a_RA_7611_IRR.pdf

Meta information

Contributor:A. Scheidel (ICTA-UAB) and Alyansa Tigil Mina (ATM)
Last update18/08/2019

Images

 

Villagers protest against Citinickel's Pulot Sofronia mine

Source: http://bulatlat.com/main/2015/03/26/palawan-indigenous-people-call-for-stop-to-citinickel-mines/