Striking a balance between mining development and environmental protection

By Sheldeen Joy Talavera, Reporter

AMID the country’s move towards the greater use of renewable energy is a need to strike a balance between maximizing the mining industry’s contribution to the economy and minimizing the impact on the environment.

The Department of Environment and Natural Resources (DENR), the agency responsible for the conservation and proper use of the country’s environment and natural resources, said it wants mining companies to go beyond compliance.

“We have complete regulation but beyond regulations, what we are trying to do with this current administration is to go beyond compliance,” DENR Undersecretary Carlos Primo C. David told BusinessWorld.

“What if you can do better than what is prescribed by law? The improvement should be continuous, and this is what we want to commend some of the companies — if they are able to do that,” he said.

Mr. David said that among the programs being implemented by the department is the monitoring of mining activities using its geospatial database office.

The geospatial database allows the agency to map and monitor the country’s natural resources, including ongoing mining activities and reforestation initiatives by using satellite imagery.

“The government has the responsibility for that,” he said. “DENR handles or manages both sides — environment and natural resources development. It seems that it’s always in conflict with each other but it doesn’t have to be.” 

The world’s surging demand for renewable energy has enabled the mining industry to thrive even during the pandemic.

Critical minerals such as nickel, cobalt, and copper are seen as vital for creating electric vehicles (EVs), their large-scale batteries, as well as wind and solar farms.

According to the Mines and Geosciences Bureau (MGB), up to 470 applications are awaiting approval for the exploration of minerals such as copper, chromite, nickel, and cobalt, as of April 2023.

“The covid pandemic showed that the mining industry is one of the more resilient sectors and was in fact a key source of US dollar inflows for the country,” said Martin Antonio G. Zamora, president and chief executive officer of Nickel Asia Corp.

Nickel Asia is the Philippines’ largest producer of lateric nickel ore and the only nickel company with processing plants.

The mining industry’s gains come as the Philippines aims to strengthen green initiatives to accelerate decarbonization.

The country has committed to reduce greenhouse gas emissions by 75% by 2030 and has pledged to help limit global warming to less than two degrees Celsius under the Paris Agreement of the United Nations Framework Convention on Climate Change.

At the same time, consumers’ shifting attitudes towards mobility have propelled the growth in the demand for nickel, a key ingredient in lithium-ion batteries used in EVs.

Global EV sales increased by 43% to 3.24 million units in 2020, data published by Sweden-based consultancy EV-volumes.com showed.

For 2023, it projected global EV sales to reach 14.3 million, up 36% from 10.52 million in 2022.

“By the end of 2023, we expect 40 million EVs in operation, counting light vehicles, 73% are BEVs (battery electric vehicles) and 27% PHEVs (plug-in hybrid electric vehicles),” it said.

Global Ferronickel Holdings, Inc. President Dante R. Bravo said the outlook for nickel remains bright primarily because of the accelerating growth of the EV sector.

“Although an oversupply in the nickel market will likely persist until 2026, deficits are expected from 2027 onwards,” he said.

Intergovernmental organization International Nickel Study Group estimated the global demand for nickel to increase by 11% to 3.22 million tons in 2023.

The Philippines saw a slight increase of 1.13% to P132.21 billion in metallic mineral production value in 2020, driven by improved nickel volumes, data from the MGB showed.

In 2022, the value surged by 31.73% to P238.05 billion on the back of higher nickel prices and robust metal production.

The nickel group accounted for 49.39% of the total output value at P117.58 billion. This came as the price of nickel went up to $11.86 per pound from $8.35 per pound.

“This strong performance can be attributed largely to the contribution of TVI Resources Development, Inc. (TVIRD) located in Zamboanga del Sur and OGPI in Nueva Ecija,” the MGB said.

Kaycee Crisostomo, communications and marketing director of TVIRD, said new technologies emerged as mining companies now use dry stacking technology to store filtered tailings — the silty and sand material left once the metals are extracted. This is an alternative to building tailings storage facilities.

“The country’s vast natural resources provide opportunities for TVIRD to explore and harness renewable energy sources to support its decarbonization targets and pursue a climate-resilient future for its communities,” he said.

The company plans to build solar power plants to augment the power requirements of its mine sites in Surigao del Norte and Zamboanga del Sur.

Global Ferronickel’s Mr. Bravo said nickel presents a compelling outlook due to the “global shift to smart and sustainable cities, which require technology and materials made from minerals such as nickel.”

In the three months to March, EV sales in the country totaled 2,535, according to the Electric Vehicle Association of the Philippines (EVAP).

EVAP President Edmund A. Araga said the launch of new EVs by Audi, Porsche, Jaguar, and BYD in 2021 paved the way to get the interest of the high-end market.

“We believe that another roadmap for the mining industry is needed,” he said, citing the “tons of opportunity” that can be gained.

He said it is essential to work with the government to make sure that the plans will roll out along with standardized policies to protect the country.

The opportunity ahead includes an estimated $1 trillion in untapped reserves of copper, gold, nickel, zinc, and silver.

The Philippines has 30% of land area identified for potential mining resources, only 1.4% of which are active mining sites, the MGB said.

In a bid to boost the industry, the DENR in 2021 lifted the four-year-old ban on open-pit mining for copper, gold, silver, and complex ores.

Meanwhile, Philippine mining companies have explored processing to transform mineral products into higher-grade materials.

“TVIRD has learned from experience that precious metals like gold and base metals like copper can and should be processed in order for the industry to benefit from the added value of semi-finished products,” Ms. Crisostomo said. Philippine mining companies have also explored processing to transform mineral products into higher-grade materials.

“TVIRD has learned from experience that precious metals like gold and base metals like copper can and should be processed in order for the industry to benefit from the added value of semi-finished products,” Ms. Crisostomo said.

For Mr. Bravo, the industry needs support from the government to attract investments by simplifying the processing of permits and tax structure, and bringing down power costs, among others.

“Mining should be given the necessary support from the government to grow responsibly and sustainably,” he said.