Role of the Department of Environment and Natural Resources (DENR)
- DENR is the primary government agency tasked with conservation, management, development, and regulation of natural resources, including mineral resources.
- DENR Secretary has authority to promulgate implementing rules and regulations for mining operations.
Context and Background of Diwalwal Mining Area
- Diwalwal, Mt. Diwata, Monkayo, Compostela Valley has been a gold rush site since 1983, with thousands of miners involved.
- Mining and mineral processing in the area have caused environmental degradation such as river pollution and mercury contamination.
- Social problems including conflicting claims, rivalry, and peace and order issues have escalated the situation to an emergency requiring government intervention.
Emergency Measures Prior to Administrative Order
- DAO No. 2002-18 declared an emergency, halted major mining operations until environmental compliance was achieved.
- Relocation of processing plants and construction of common tailings disposal system mandated.
- Implementation of mine management plan aimed at addressing socio-environmental concerns and supporting sustainable livelihoods.
Proclamation No. 297 - Mineral Reservation and Environmentally Critical Area
- Declares the Diwalwal mining areas and Mabatas Area as mineral reservation and environmentally critical area.
- Mining operations may be undertaken directly by DENR or through qualified contractors, subject to payment of just compensation.
- DENR directed to issue guidelines and establish an environmental and social fund.
Objectives of the Administrative Order
- Rationalize mining and processing for efficiency and environmental protection.
- Address health and safety concerns of miners and residents.
- Improve social and economic conditions of underprivileged sectors involved.
- Stabilize peace and order.
- Ensure equitable sharing of benefits for communities, government, and stakeholders.
Coverage and Definition of Terms
- Applies to mining and processing within the Diwalwal Mineral Reservation.
- Defines key terms such as "Mill Tailings," "Mine Waste," "Mineral Processing," "Service Contractor," and the geographic boundaries of the area.
Delineation of Mining and Processing Areas
- Mines and Geosciences Bureau (MGB) to identify areas where mining may occur, considering ore vein characteristics and buffer zones.
- Mining restricted to delineated and verified areas.
Direct State Utilization
- DENR to undertake mining and processing directly in selected areas via Natural Resources Development Corporation (NRDC).
- NRDC and DENR to formalize operation through Memorandum of Agreement.
- Just compensation to be paid to legitimate claimants.
Responsibilities of the NRDC
- Implement medium-scale, labor-intensive, environmentally sound mining and processing.
- Secure necessary permits and comply with requirements.
- Engage professional groups for planning and operations.
- Construct processing plants and tailings disposal system.
- Collect government share and establish environmental/social fund.
- Conduct environmental clean-up.
- Provide certain services to mining operations optionally.
- Coordinate with DENR agencies for plan implementation.
Service Contracts
- DENR or NRDC may enter service contracts with mining groups or cooperatives for mining and/or processing within specified areas.
- Contracts based on recommendations of MGB and Multisectoral Evaluation Committee.
- Existing valid service contracts prior to this order remain valid if consistent.
Multisectoral Evaluation Committee (MEC)
- MEC composed of representatives from technical working group, mining groups, local government unit, indigenous communities, and NGOs.
- Responsible for evaluating and endorsing service contract applicants.
Allocation for Small-Scale Mining
- MGB to allocate up to 25% of the mineral reservation area for small-scale mining cooperatives as per People's Small-Scale Mining Act (R.A. No. 7076).
Transport of Ores
- Ore transport subject to Ore Transport Permit (OTP).
- Unauthorized transport leads to confiscation of materials.
- OTP issues to service contractors upon NRDC recommendation.
Management of Mine Wastes and Mill Tailings
- Must be managed with technical, financial, social, cultural, and environmental responsibility.
- Compliance with DENR Memorandum Order No. 99-32 guidelines.
- Mineral processing plants to be relocated to Mabatas Area with engineered tailings dam system.
- Mabatas Area also designated for community resettlement.
Environmental Protection and Community Development
- NRDC to submit and implement Environmental Protection and Enhancement Program (EPEP) sanctioned by DENR.
- Conduct Environmental Impact Assessment (EIA) and obtain Environmental Clearance Certificates (ECC).
- Submit Social Development and Management Program (SDMP) consistent with regulatory guidelines.
Regulation of Explosives and Chemicals
- Only NRDC authorized to secure licenses for explosives and chemicals.
- License applications require endorsements from MGB or Environmental Management Bureau (EMB).
- DENR Secretary may authorize other entities if necessary.
Mine Rehabilitation
- Service Contractors required to conduct technical and biological rehabilitation of disturbed areas.
- Establishment of Mine Rehabilitation Fund as a trust for physical and social rehabilitation.
Enforcement of Mining Plan and Environmental Compliance
- MGB and EMB enforce compliance with mine management plans and ECC.
- Can recommend suspension or cancellation of service contracts upon violations.
Confiscation and Penalization
- DENR/MGB empowered to seize illegally sourced ores and mill tailings.
- Violators can be apprehended and prosecuted.
Sale of Gold
- All gold produced by service contractors to be sold to Bangko Sentral ng Pilipinas or authorized agents.
- Pricing to be competitive with world market rates.
Government's Share
- NRDC authorized to collect up to 20% of ore produced as government share covering excise tax, royalties, and other fees.
- Collection of applicable service fees from service contractors permitted.
Multipartite Monitoring Team
- Continues to monitor service contractors’ compliance with contract terms under DENR Special Order.
Service Providers
- Service Contractors may engage service providers with contract approval by MGB following recommendations.
Reporting and Fines
- Mandatory submission of production and sales reports by NRDC and service contractors as per existing regulations.
Dispute Resolution through Arbitration
- Mining disputes to be settled by an arbitration tribunal composed of party appointees and MGB Director as chair.
- Arbitration governed by the Arbitration Act (R.A. No. 876).
Transitory Provisions
- Existing service contractors to comply immediately with this Order.
- Mineral processing plants compliant with law may be used until Mabatas Area becomes operational.
Separability and Repealing Clauses
- Unconstitutional parts do not affect validity of remaining provisions.
- Conflicting orders and rules are repealed or modified accordingly.
Effectivity
- The Order took effect immediately upon issuance on December 3, 2002.