Mining firm pays Lumads P51.5 million royalty

“We are pleased to confirm that we have today made a deposit in the amount of P51,536,292.46” to the account of the Asosasyon sa Madazaw na Panagkaisa nan mga Tribong Mamanwa sa Taganito ug Urbiztondo (Ampantrimtu) in the Land Bank of the Philippines branch in Surigao City,  TMC President Gerard H. Brimo, in his February 19 letter to lawyer Jose Dumagan, acting regional director of the National Commission on Indigenous Peoples (NCIP), said

 “The amount represents 1% of our gross sales of Nickel laterite computed from July 2006 (the date of our Memorandum of Agreement with the Ampantrimtu) to December 2007 from our Taganito mine,” Brimo said.

“Once our audited sales figures of laterite shipments in 2008 are finalized, we will provide a similar computation for the royalty due. In the absence of any specific guidelines on when this should be paid, we propose to pay the 1% royalty on sales for the first half of 2008 at the end of June and the royalty for the second half or 2008 at the end of September.”

The amount represents 1% of the P5.1 billion audited shipment report of TMC from July 2006 to December 2006 when the gross value of the beneficiated nickel silicate ore shipped to Japan and limonite shipped to Australia was P905,396,957.33 and in 2007when the gross value of the shipments of the same to Japan and Australia plus a shipment of low grade soft ore to China totaled P4,248,232,289.08.

The 2006 and 2007 records which formed the basis of the payment of royalty share to the Mamanwas were forwarded to Dumagan by Alilo Ensomo, Jr., OIC  Regional Director of the Mines and Geo-Sciences Bureau in a letter dated December 17, 2008.

Brimo ended his letter by saying “We believe that this is the largest IP royalty payment to date by any mining company pursuant to the 1995 Mining Act and the IPRA (Indigenous Peoples Rights Act of 1997). We are delighted to play such a major role in the advancement of our Mamanwa brothers and we look forward to continuing good relations with them and the NCIP.”

TMC request

But the third paragraph of his two-page, five-paragraph letter to Dumagan contained a request: “Considering the large amounts involved and our activities in a portion of the CADT (Certificate of Ancestral Domain Title) area, we would like to request that our company be active in assisting the Mamanwa tribe in the formulation of their Ancestral Domain Sustainable Development and Protection Plan together with the NCIP and other concerned sectors of society. We believe that there could be certain synergies between our operations and the tribe and our inputs could thus be important.”

He thanked Dumagan for “your assistance in resolving the various problems that we encountered as we embarked on this process. It is regrettable that a non-IP third party became involved, resulting in the delay in our payment, and worst of all, driving a wedge between certain Datus of  the tribe. Your vigilance and cooperation in seeing us through this problem is most appre
ciated.”

Brimo was apparently referring to the entry of a Butuan City-based contractor, Engr. Sergio Pascual, a former contractor of TMC, into the scene.

Saying he was given a Special Power of Attorney by the tribe to represent them, Pascual in October last year wrote TMC and the other mining firms operating in the Mamanwas’ ancestral domain — Oriental Synergy Mining Corporation and Platinum Group Metals Corporation – to a meeting, notifying them to pay the 1% royalty fees due the Mamanwas.

Pascual  pointed to TMC’s July 2006 Memorandum of Agreement with the Ampantrimtu where TMC vowed to pay half a million pesos as annual financial assistance to the Lumads.

Ampantrimtu is the organization of Mamanwas that forged a Memorandum of Agreement with TMC and the NCIP on July 18, 2006,  when TMC was applying for a Mineral Production Sharing Agreement (MPSA) for the “exploration, development and  commercial utilization of nickel ores/deposits located at  Barangays Urbiztondo and Hayanggabon,” covering 4,975.03 hectares.

Under the law, no MPSA can be granted without the free and prior informed consent of the tribe.

The Mamanwa tribe holds a Certificate of Ancestral Domain Title (CADT) over 48,870,026.3 hectares in the  towns of Alegria, Bacuag, Claver, Guigakuit and Tubod in Surigao del Norte.  The CADT of the Mamanwas was issued on September 22, 2006, two months after the MOA singing between TMC and Ampantrimtu.

TMC’s MPSA was approved July 28, 2008.

“Financial Assistance” vs Royalty

The July 2006 MOA, signed by Datu Alfredo Olorico, Datu Rizal Buklas (father of Datu Reynante) – leaders of the area where TMC is operating — and Datu Emiliano Gedi, the CADT head claimant, stipulated only an annual “financial assistance amounting to P500,000” released in two equal tranches every last week of June and second week of December, until 2031.

Datu Olorico and Datu Reynante Buklas confirmed having received a total of P1.5 million from the firm which they divided among themselves. But the leaders said they did not know that under the Mining Act of 1995 and IPRA of 1997, they were entitled to a 1% royalty/share from the gross output.

The Datus said the NCIP did not tell them they were entitled to royalty and that it was Pascual who told them they were entitled to so much more under the law.

But the NCIP, sitting en banc on November 13, passed Resolution passed Resolution 325 declaring that the special power of attorney that designated Pascual as Attorney-in Fact of the Mamanwas and the MOA resulting therefrom “violates the provisions of the Indigenous Peoples Rights Act and NCIP Administrative Order NO. 1, Series of 2006” and also declared that it is “contrary to the customs, tradition and practices of the Mamanwa tribe.”

The NCIP also passed Resolution 324  authorizing Dumagan to “renegotiate, execute, and/or enter into favorable terms and conditions for and in behalf of the Mamanwa tribe of Surigao del Norte and the NCIP.”

The resolution acknowledged that “some of the terms and conditions” of the  July 2006 MOA are “not in consonance with the provisions of the Philippine Mining Act of 1995 as well as with Indigenous Peoples Rights Act of 1997 (RA 8371) which provides for the protection and promotion of the interest of the ICCs/IP,” particularly citing the P500,000 annual financial assistance when it should be 1%  of the gross production/output as IP royalty/share.

Half a million pesos a year under the July 2006 MOA is very tiny fraction of  the Mamanwas’ 2006 royalty of P9 million and 2007 royalty of P42.4 million.

“Will comply”

Dumagan, who assumed the post of acting regional director of the NCIP on October 12, 2006, acknowledged that the NCIP  was remiss in not having pointed the 1% royalty during the formulation of the July 2006 MOA. “That’s why we are trying to correct that,” he told MindaNews Tuesday in his office in Butuan City.

Following Resolution 324, the  TMC and NCIP signed a Joint Undertaking on December 8, 2008, acknowledging that the P500,000 annual financial assistance “does not accurately represent the amount due to the Mamanwa Tribe (Ampantrimtu) as their IP loyalty/share” and that “it is the desire” of TMC to “faithfully comply with its legal obligations to the Mamanawa Tribe based on the provisions of both the Philippine Mining Act of 1995 and the Indigenous Peoples Rights Act of 1997.”

The Joint Undertaking was signed by TMC president Gerardo Brimo and NCIP’s Dumagan, in the presence of CADT Head Claimant Datu Emiliano Gedi and MGB’s Ensomo.

Under the Joint Undertaking, the NCIP regional office is mandated to assist the Mamanwa tribe in the formulation of the Ancestral Domain Sustainable Development and Protection Plan (ADSDPP) “as soon as possible.”

In preparing the ADSDPP, the NCIP, according to the Joint Undertaking, “may seek the assistance of the concerned Local Government Units, Indigenous Peoples Apostolate, Social Action Center, Mines and Geosciences Bureau regional office and other government agencies and non-governmental organizations in the formulation of the Mamanwa Tribe’s ADSDPP.”

The Indigenous Peoples Apostolate and Social Action Center belong to the Catholic Diocese.

According to NCIP Administrative Order No. 1, issued on January 30, 2004, ADSDPP “refers to the consolidation of the plans of ICCs/IPs within an ancestral domain for the sustainable management and development of their land and natural resources as well as the development of human and cultural resources based on their indigenous knowledge, systems and practices. Such plan shall be the basis of the Five Year Master Plan for ICCs/IPs.”

The Policy Statement under Section 2 of the Guidelines states that “the sustainable development and protection of the ancestral domain by the ICCs/IPs themselves is the manifestation of their rights to self-governance and self-determination. To guarantee the exercise, enforcement and realization of these rights, the ICCs/IPs shall prepare their own ADSDPP in accordance with their customary practices, laws and traditions” (Carolyn O. Arguillas/MindaNews)

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