Australian company OceanaGold has appealed directly to Philippine president Rodrigo Duterte against the suspension of its gold and copper mine on Luzon island that employs 1800 workers, most of them Filipinos.
Philippine Environment and Natural Resources Secretary Regina Lopez, an ally of Mr Duterte, this week expressed frustration that a controversial order she made in February to suspend or close more than half of the country's mines has not been carried out, including OceanaGold's Didipio mine, 270 kilometres north of Manila.
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OceanaGold fights Philippines mining crackdown
The Australian mining company has appealed directly to Philippine president Rodrigo Duterte against the suspension of its contract.
Ms Lopez issued the order as part of a government campaign to fight environmental degradation without giving 23 mining companies the opportunity to oppose the decision, business analysts say.
The mines are the world's top nickel exporter.
![The OceanaGold gold and copper mine on Luzon island employs 1800 workers, most of them Filipinos.](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/v/q/0/5/l/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
Melbourne headquartered OceanaGold told Fairfax Media in a statement that if negotiations to lift the suspension fail the company will consider "all legal and administrative remedies" available to "ensure there is no disruption to the mine and its workforce".
Didipio, one of the world's lowest-cost gold mines, which began operation in 2013 after years of delays, was awarded Mr Duterte's 2016 Mineral Industry Environment Award, which recognises safe and responsible mining.
Peter Wallace, a leading business consultant in Manila, said the mine crackdown has set back the potential for new mines in the Philippines, which is one of the most richly mineralised countries.
"A number of overseas mining companies have decided not to even look at the Philippines for the time being," he said.
![OceanaGold chief Mick Wilkes is confident on the future of his Philippines mine.](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/s/x/8/5/v/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
OceanaGold's troubles in the Philippines come after Thailand's military government shut down Sydney-based Kingsgate's Chatree gold mine 280km north of Bangkok on 31 December, throwing 1100 people out of work.
Australian mining company Eumeralla Resources, which is undergoing restructuring and a name change, has abandoned its plans to pursue mining opportunities in eastern Myanmar after an almost four-year wait for a permit.
![OceanaGold's Didipio mine is one of the world's lowest-cost gold mines.](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/v/q/0/5/n/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
In the Philippines, another Australian-based miner, Red 5, has ceased operations at its Siana gold and silver mine in northern Mindanao, citing delays in obtaining approvals to develop and uncertain regulatory and government mining policies.
In 2015 the Anglo-Swiss miner Glencore quit the Tampakan copper-gold project in Mindanao – one of the world's largest gold prospects – after stiff opposition from local communities and environmental groups, which delayed approvals.
A number of overseas mining companies have decided not to even look at the Philippines for the time being.
Peter Wallace
Ms Lopez, a 63-year-old staunch environmentalist and former yoga missionary, has vowed not to reverse her order despite outcries from the mining industry and powerful Philippine business leaders and politicians.
"I'll be so blatant to say the Philippines is unfit for mining … because we're an island ecosystem with biodiversity like no other," she said when announcing the order.
![OceanaGold had a stormy relationship with indigenous locals and officials before the mine opened, including violent protests.](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/u/4/3/g/1/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
On Wednesday, Ms Lopez publicly criticised Mr Duterte's executive secretary, Salvador Medialdea, for overturning her ban on nickel stockpiles being exported unless companies pay hefty fees for every hectare of land they have disturbed.
She said appeals to Mr Duterte by companies such as OceanaGold have become "stuck" because papers have not reached his office.
![OceanaGold chief executive Mick Wilkes is presented with the Presidential PMIEA award in November 2016 at a ceremony ...](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/v/q/0/5/o/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
Mr Duterte, a firebrand former provincial mayor swept into office last year promising to eliminate drugs and crime, has backed Ms Lopez's order, saying the Philippines could survive without a mining industry.
The President reappointed her to head the department this week but the appointment has still to be ratified by the country's parliament, giving mining companies hope Mr Duterte will be forced to name a replacement.
![OceanaGold said more than 3000 jobs would be lost if the mine was to close.](/web/20170424062420im_/http://www.smh.com.au/content/dam/images/g/v/q/0/5/m/image.related.articleLeadwide.620x349.gvpusj.png/1492978585663.jpg)
The companies have signalled they are prepared to take legal action en masse if necessary.
"The minister's order violated due process. The companies were not given the opportunity to respond," said a business consultant in Manila, adding that Ms Lopez's audit team members who recommended the closures were mainly environmental activists.
The auditors reportedly found faulty construction in a single house near Didipio mine site.
The Philippine mining industry body has described Ms Lopez's order as "illegal and unfair".
"We have a total of 1.2 million people affected," said Artemio Disini, chairperson of the Chamber of Mines of the Philippines.
OceanaGold had a stormy relationship with indigenous locals and officials before the mine opened, including violent protests.
It was accused of illegally demolishing 187 houses in Didipio town in 2008.
In 2011 the Philippine Commission on Human Rights recommended the government consider revoking the company's license because of its treatment of indigenous people.
OceanaGold told Fairfax Media its operations have delivered significant direct and indirect benefits to the local community, including providing health and social services, education programs, scholarships and training.
It said more than 3000 jobs would be lost if the mine were to close, including the 1800 employees, and up to 7000 would be affected.
The company said it has paid taxes and royalties estimated at $US70 million to the government over three and a half years.
It has plans to continue mining until 2030.
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