Plundering LP miner remains unpunished
GOTCHA By Jarius Bondoc (The Philippine Star)
November 20, 2017
An influential mine that over-extracted 1.8 million tons of ore worth P2.8 billion continues to operate, escape taxes, and ruin nature. Reports from Tubay, Agusan del Norte, are that SR Metals Inc. (SRMI) goes on leveling mountains for nickel. No government agency has brought up charges for the plunder of natural resources, or collected taxes on the excess profits. It allegedly enjoys new political protectors, the same way it did in the past two administrations.
Behind SRMI is Francis Enrico “Eric” Gutierrez, ex-Liberal Party head for Caraga Region, Northern Mindanao. He is said to have funded the LP presidential runs of Noynoy Aquino in 2010 and Mar Roxas in 2016. SRMI’s founding chairman is LP spokesman-vice chairman Rep. Edgar Erice (Caloocan City). Scientists and churchmen in Agusan quote SRMI insiders as claiming to be protected by provincial officials. Gutierrez reportedly is expanding his turf to Bicol region in Luzon.
The three branches of government had found SRMI abusing its franchise. Purportedly in cahoots were two affiliates, San R Construction Corp. and Galeo Equipment Corp. First SRMI, then San R and Galeo, wangled “small-scale” mining permits over 20 hectares, from 2006 to 2008. Presumed to use only shovels, picks, and wheelbarrows, they were each given quotas of up to 50,000 tons of ore per year for two years. Yet the three “small miners” brought dozens of bulldozers, excavators, and dump trucks to hundreds of hectares up the mountains, and barges to the nearest seaport. From Aug. 2006 to Sept. 2007 alone, SRMI had extracted 1.78 million tons. On complaint of environment NGO Caraga Watch, the Dept. of Environment and Natural Resources (DENR) cancelled their permits. Subsequently the DENR secretary was replaced with an LP stalwart.
The trio ran to the Court of Appeals for a temporary restraining order. They reinterpreted their permits to mean they were allowed to extract up to 50,000 tons of pure nickel and cobalt. Since “it took 151,612 tons of ore to extract only 1,699.66 tons of nickel-cobalt,” they supposedly were far from being in excess. The CA found the reasoning absurd and upheld the cancellation of the mine. SRMI et al elevated their case to the Supreme Court.
Meantime, in 2008, a rival claimant charged the mining trio with plunder before the Ombudsman. They got the malleable justice secretary to uphold their quota reinterpretation, against that of the DENR and CA. So the Ombudsman sat on the case.
In 2014 a five-member division of the SC unanimously upheld the CA and DENR cancellations. Citing the Mining Act of 1995, the justices defined “ore “ as “naturally-occurring substance or material from which a mineral or element can be mined and/or processed for profit.” To say otherwise would allow small-scale mines to continuously collect large volumes of ore until the 50,000-ton limit is met. The SC concluded: “To allow such would further cause damage to the environment such as erosion and sedimentation, landslides, deforestation, and rock drainage.” Which were exactly what SRMI, San R and Galeo did to Agusan.
The SC ruling should have paved the way for the reopening of the plunder case. By then the ruling LP administration of Pres. Noynoy Aquino had appointed a new Ombudsman.
In Sept. 2015 the Senate investigated the trio. SRMI officers claimed to have extracted only 1.7 million tons, each ton worth $30-$40. DENR officials stated that SRMI et al heavily had damaged the mountains, rivers, and seas. Detailed were six violations: hazardous mining, inadequate rehabilitation, improper drainage, failure to relocate displaced families, misuse of public road for private purposes, and lack of water treatment. For all that SRMI, San R and Galeo were fined a measly P7.2 million.
Investigating chairman Sen. Francis Escudero sarcastically used SRMI’s deflated figures to point up the inconsistency. Granting that the three were entitled to 300,000 tons in two years, so multiplying only 1.4 million tons by $30, at an exchange rate of only P40:$1, SRMI profited P1.68 billion yet was penalized only P7.2 million. With such business model, Escudero concluded, SRMI would continue to break the law.
Shortly afterwards, SRMI got the DENR to upgrade its license as large-scale miner. Pres. Aquino then awarded it as exemplary miner for all to emulate. Never was SRMI made to return the excess mining profit. Nor was it made to pay taxes on the windfall.
In 2016 Gutierrez provided LP presidential candidate Roxas with eight luxury jets and helicopters: a Citation Mustang worth $2.5 million; a Citation CJ4, $9m; a Cessna Sovereign, $19m; four Cessna Caravans, $2.5m each; and one Bell 429 chopper, $6.5m. The first three jets and the helicopter were brand-new. For that $47-million (P2.3-billion) import, paltry duties were paid.
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