The Department of Environment and Natural Resources (DENR) has announced that additional mineral reservation areas throughout the country may soon be declared to help provide equitable access to mineral resources and generate additional non-tax revenues for the government.

Undersecretary for Mining Analiza Rebuelta-Teh said the DENR, particularly its Mines and Geosciences Bureau (MGB), is now in the process of identifying “mineralized areas and high mineral potential areas, including all existing operating mines,” for declaration as mineral reservations.

In fact, she said, certain sites have undergone the process prescribed by law and are ready for endorsement to President Rodrigo Roa Duterte for declaration as mineral reservations, pursuant to Republic Act 7942 or the Philippine Mining Act.

“The law provides that when the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation of the MGB Director through the DENR Secretary,” Teh pointed out.

Teh issued the statement in the wake of news reports regarding an Audit Observation Memorandum (AOM) issued by the Commission on Audit (COA) Regional Office XIII on the alleged failure of the DENR to collect almost P2.6 billion in royalty fees from five mining companies in Caraga region.

The AOM stated that royalties should have been imposed against the mining companies since they extract mineral resources that are owned by the government.

However, Teh clarified that the present mining law requires payment of royalty fees only in areas declared as mineral reservations.

“The five mining companies mentioned in the COA report are operating outside the Surigao Mineral Reservation Area. Thus, the permits granted to them do not contain any provision for them to pay royalty,” Teh explained.

Teh said that all actions of the DENR and MGB on the matter were “in accordance and consistent with existing laws and regulations.”

To address the concerns of the COA and the government in general, to generate more revenues from the mining industry, Teh said the DENR is looking at the declaration of more mineral reservations to include sites where the five mining companies operate, as a solution.

The DENR, she added, also proposed to the Department of Finance to include the imposition of royalty fees on mining firms operating outside mineral reservations in the second package of the Tax Reform for Acceleration and Inclusion or TRAIN law.

“Should an amendatory law be passed, the imposition of royalties on mining operations outside mineral reservations will be applied prospectively,” Teh said. ###

Reference: Undersecretary Benny Antiporda