DENR issues 5-yr contracts to 2 small miners’ groups

The Department of Environment and Natural Resources (DENR) has issued five-year mining contracts to two small-scale mining groups in the controversial Mt. Diwalwal Gold Rush Area which is expected to bring in tax revenues of about P30 million.

Outgoing DENR Secretary Heherson T.Alvarez said the two separate contracts with the Compostela Valley Federation of Mining Cooperative (CFMC), composed of 5,000 members, and the group of Pedro Francisco, composed of 300 members, were the first mining contracts signed after President Arroyo declared the Diwalwal gold reserve as a mineral reservation area.

Mining operations were stopped earlier this year by the government because of deteriorating peace and order conditions triggered by various warring groups in the gold mining area, mostly subsistence miners operating independently and devoid of all acceptable mining practices. This has resulted also in the worsening pollution of the area, including shantytowns that mushroomed at the height of the boom in gold mining and production.

Mt. Diwalwal is in a gold-rich tract of mineral land situated in the Agusan-Davao-Surigao Forest Reserve known as the Diwalwal gold rush area, covering the municipality of Monkayo in Davao del Norte.

Under the new agreement, 85 percent of gold extracted and produced will go to the small miners and 15 percent to government. Of the 15-percent government share, five percent will be the royalty tax to government for use of natural resources; five percent management fee; two percent — excise tax; two percent — environmental and social fund; and one percent — for indigenous peoples. Previously, the miners only got a 40-percent share.

Mines and Geosciences Bureau Director Horacio Ramos said that with the new mining contracts, gold ore production which now stands at about 100 metric tons, could go up as high as 1,000 MT a day.

Alvarez added that since government took over all mining operations in Diwalwal in August, it has accumulated five billion of 99 percent pure gold, worth about P6 million. – Rocel Felix