Philex to contest fine

MANILA, Philippines - Philex Mining Corp. (PMC) is contesting the P1.034 billion fine officially imposed by the Mines and Geosciences Bureau (MGB) of the Department of Environment and Natural Resources (DENR) for the tailings spill in its copper-gold mine in Padcal, Benguet, saying it is only willing to pay for the cost of rehabilitation, clean up and damages to affected families.

PMC is expected to respond within the week to the Sept. 26 letter of MGB which imposed a P1.034 billion fine on Philex for violation of the Mining Act of 1995. 

The P1.034 billion fine does not include the penalty for the violation of the Clean Water Act of 2004 and the fine per violation to its Environmental Compliance Certificate (ECC) contract.

Under the Clean Water Act, PMC faces a fine of P50,000 to P200,000 per day from the day of occurrence—Aug. 1 – until the pollution in cleared from waterways affected by the spillage.

The MGB said the spillage from the Agno River and Balog Creek is still not cleared.

Under the ECC contract, PMC faces a fine of P50, 000 per provision violated.

“But our position is we should not be made to pay for things we have not been negligent of. Of things that were caused by force majeur,” said PMC spokesperson Mike Toledo in a phone interview yesterday.

After PMC submits is arguments, the DENR will conduct a one-week review of the arguments, after which it will render a final decision.

After this, PMC will be given 15 days, as mandated under the law, to settle the fines although the terms for payment are still negotiable.

PMC may still file a motion for reconsideration with the Office of the Environment Secretary.

In an earlier interview, MGB director Leo Jasareno said the Mining Act does not provide for incidents caused by force majeur. He said that under the law, tailings “should be 100 percent contained.” 

“Tailings spill is naturally an accident, you will not do it deliberately,” he had said.

In a letter dated Sept. 26, Jasareno told Philex president Eulalio Austin Jr. that according to the findings of the multi-disciplinary team created to determine the fines to be imposed in connection to the incident, the total volume of discharged sediment to the Balog River has reached 13, 513, 507 cubic meters as of Sept. 6.

With the sediments having a bulk density of 1.531 metric tons of solids per cubic meter, the total weight of discharged solids is 20, 689, 179.42 metric tons.

Under the Mining Act of 1995 a penalty of P50 per metric ton of tailings “discharged into areas other than the approved tailings disposal area.”

“As such, the tailings fee of P1,034,358,971.00 has been computed to be payable by PMC, based on the 20,689,179.42 metric tons of discharged solids to Balog River,” Jasareno said in the letter.

It was also discovered that PMC undertakes a maintenance check of its broken tailings pond No. 3 only once a year. 

“Further the report also finds that your monitoring of tailings pond No. 3 and its appurtenances should be undertaken more frequently to ensure its integrity/performance. It notes the once-a –year monitoring of the penstocks and drainage tunnels of tailings pond No. 3,” Jasareno said. 

PMC earlier said that it is building two new tailings ponds to replace the broken tailings pond No. 3, which is now 20 years old, having been constructed in 1992.

It will take between six to 12 months each to construct tailings pond No. 4 and No. 5.