Digging for profits: Who owns PH mines?
QUICK FACTS
Name of mining firm: LNL Archipelago Minerals Inc.
Location: Sta. Cruz, Zambales
Mining area: 951.57 hectares
Metals extracted/mine products: Nickel ore
Nickel production (2020): 290,853 dry metric tons (direct shipping ore) valued at P743,318,584
Mining permit period: 2008-2033
OWNERSHIP
Incorporation date: Jan. 25, 2007
Stockholders:
LNL Resources Inc. Domestic Corp.
Leonio, Lawrence N.
Leonio, Leonardo L.
Asuncion, Clarissa Teresita L.
Leonio, Carlo Leonardo N.
Reyes, Oscar S.
Castillo, Juan M.
Chairperson of the Board: Leonio, Lawrence N.
According to LNL’s webpage, the company is operating under the LNL Resources Inc., the mining division of the Leonio Group, whose other ventures include Petrolift Inc. and Leonio Land.
MINING REVENUE
Current assets: P313.82 million (2017)
Current liabilities: P413.01 million (2017)
Total revenue: P236.82 million (2017)
Export sales of nickel ore: P132.4 million (2017)
Net income: -P110.21 million (2017)
MINE AUDIT FINDINGS (2016/2017)
According to the Notice of Issuance of an Order sent to the company on Feb. 8, 2017 pertaining to operations under MPSA 268-2008-III, the company had violated certain provisions of mining and environmental laws, such as:
- lack of emergency drills;
- lack of warning signages within the active mining area and haulage roads;
- lack of discharge permit for the oil and water separator;
- lack of tree-cutting permit;
- failure to desilt filled-up silt traps;
- no monthly internal and on-site monitoring of the Annual SDMP implementation;
- incomplete implementation of the 2015 Annual SDMP; and
- failure to comply with the conditions of the July 15, 2014 suspension order, particularly on the construction of an alternative exclusive mine haulage road, among others.
Field validation by the DENR also found that the company’s operations have impaired the functions of the watershed in the area.
The DENR review of the audit report as well as explanations from the company showed that it had violated certain provisions of the following laws, rules, and regulations:
- RA 7942 or the Philippine Mining Act of 1995;
- DAO 2010-21 or the Revised IRR of RA 7942;
- DAO 2000-98 or the Mine Safety and Health Standards;
- PD 705 or the revised Forestry Code of the Philippines;
- DAO 1987-80 or the regulations governing the measurement, assessment, and payment of forest charges on timber and other forest products; and
- DAO 2012-02 or the uniform replacement ratio for cut or relocated trees.
These violations, according to the order, constituted sufficient grounds for the cancellation of the firm’s MPSA.
The full report and/or copy of the DENR order may be viewed here.
STATUS OF RECOMMENDATIONS / COMPANY RESPONSE (AS OF MARCH 2022)
PCIJ sent a letter to the company on Feb. 21, 2022 and made a follow-up on March 2, 2022. We have not received a response as of this writing.
STATUS OF OPERATIONS
Concerned citizens of Sta. Cruz, Zambales filed a petition for a Writ of Kalikasan, an injunction, against five mining firms (including LNL) in 2016. The Supreme Court granted the petition. But after petitions before the Court of Appeals, the provisional Writ of Kalikasan issued by the high court was lifted.
In 2017, the Department of Environment and Natural Resources (DENR) ordered the mine’s closure. The company continued operations pending the Mineral Industry Coordinating Council’s review ordered by the Office of the President.
COMMUNITY PROFILE
Municipality class of mining location: Sta. Cruz, Zambales (1st class)
Population: 58,151 (2015)
Poverty incidence rate: 23.7% (2015)
Human Development Index: 0.53 (2012, provincial)
Major sources of livelihood: Nickel mining, farming, fishing
IN THE NEWS
SC lifts writ of kalikasan against mining firm in Zambales
Zambales mining firms ordered to pay P3.2-M indemnity to farmers
Sources:
General Information Sheet, 2018
Financial Statement, 2017
List of existing Mineral Production Sharing Agreements, Mining and Geosciences Bureau
Philippine Metallic Mineral Production, Mines and Geosciences Bureau
Poverty and socioeconomic indicators, Philippines Statistics Authority
Copy of full Mine Audit Reports by company, 2016
Copy of Notices of Issuance of an Order, 2017
Copy of Orders of Cancellation and/or Suspension, 2017
Acronyms used:
RA (Republic Act)
IRR (Implementing Rules and Regulations)
PD (Presidential Decree)
DAO (Department Administrative Order)
MPSA (Mineral Production Sharing Agreement)
SDMP (Social Development and Management Plan)
Disclaimer: The mine audit was conducted in 2016 after Regina “Gina” Paz Lopez assumed the post of environment secretary. The findings in the reports, which authorities sent to the mining firms in 2016, were likely addressed in the succeeding years following a review conducted by the Mining Industry Coordinating Council after the audit led by Lopez, who died in 2019. PCIJ has verified the reports and reached out to each company for comment. We suggest you also confirm findings included in the reports as some information may have changed over time.
The reports come from files that PCIJ has received in connection with various environmental investigations. We are releasing them in full, recognizing the public value of the files to mining communities, miners, policymakers, civil society, and researchers.
Note: The Human Development Index is a measure of how well a country has performed, not only in terms of real income growth, but also in terms of social indicators that measure people's ability to lead a long and healthy life, acquire knowledge and skills, and have access to the resources needed to afford a decent standard of living. An HDI value below 0.550 is considered low and below 0.399 is very low. The national average for the Philippines is 0.718 as of 2020.
This article was produced with the support of Internews' Earth Journalism Network.