Arroyo’s Flagship Mining Project in the Red

Two years after it caused its first mine tailings spill in the island of Rapu-Rapu in Albay on October 11 2005, the Arroyo administration’s flagship mining project is now in the red and has left its promises of prosperity for Rapu-Rapu’s residents unfulfilled.

Posted by Bulatlat
Vol. VII, no. 36, October 14-20, 2007

One toilet, declining fish catch for residents, and financial woes.

Two years after it caused its first mine tailings spill in the island of Rapu-Rapu in Albay on October 11 2005, the Arroyo administration’s flagship mining project is now in the red and has left its promises of prosperity for Rapu-Rapu’s residents unfulfilled, green watchdog group Kalikasan People’s Network for the Environment (Kalikasan PNE) today summed up.

In a statement, Clemente Bautista, Jr., National Coordinator for Kalikasan PNE, said that there were indications that the government’s Australian-owned mining showcase has failed to get out of its dire financial straits ever since the mine tailings spill in 2005.

Losses larger than project cost

“Contrary to what Lafayette Mining is desperately trying to project, it is now a sinking ship that is struggling to stay afloat financially. In its annual financial statement for the year ended 30 June 2007 which was released to the public last October 3, Lafayette Mining Limited recorded a staggering consolidated loss of Aus$94,330,385,” Bautista said.

“Last year, Lafayette also incurred losses of around Aus$77,626,448. These successive losses only indicate that Lafayette is deeply in the red,” Bautista said. “This amount is even bigger than the Rapu-Rapu Polymetallic Project’s original projected cost of around US$43 million or Aus$58 million ,” Bautista said.

“Last week, Lafayette Mining’s share prices also dipped as much as 51 per cent at the Australian Stock Exchange after it announced a major restructuring that could leave present shareholders with as little as 9 per cent ownership,” Bautista said.

“Ironically, the Filipino people are the ones paying for Lafayette’s losses with our national patrimony and gold and other mineral reserves that Lafayette continues to ship out of the country,” Bautista said.

“It’s suicidal, illogical and foolish for the Arroyo administration and the DENR to further allow such a financially-volatile project to continue. In the event of another environmental disaster caused by its mining operations, we doubt that Lafayette will have little-if any-resources left for rehabilitation, mitigation and compensation funds. It can conveniently cite bankruptcy and pull out from Rapu-Rapu leaving Filipinos with nothing but toxic waste and shattered livelihoods,” Bautista said.

Lafayette Mining Limited owns 74 percent of the Rapu-Rapu Polymetallic Project in Albay which began operations in April 2005. Six months later, on October 11 and 31 2005, two mine tailings spills occurred which resulted in fish kills. Despite this, Lafayette was allowed by the DENR to continue with full commercial operations.

“It is not only in the stock market where Lafayette has failed. After two years of monitoring the mining project in Rapu-Rapu, we from Philippine environmental and peoples organizations give Lafayette mining a grade of ‘F’ for 2007: for failing to protect the island paradise and for failing to bring about its rosy promises of prosperity to the people,” Bautista said.

Backlog of community projects

Reports from Kalikasan PNE’s local networks under Save Rapu-Rapu Alliance (SARA) also belied claims by Lafayette that is was building adequate community infrastructures, Bautista said.

“The school building claimed as built by Lafayette is not true. Only one toilet was built,” Bautista said, “The local Save Rapu-Rapu Alliance (SARA) reports that even the residents of Rapu-Rapu themselves attest that some of the social development and livelihood projects are not true. An example is goat raising. A streamer for the project, not actual goats, is displayed there, according to Virgilio Perdigon Jr. of SARA ,” Bautista said.

In Barangay Pagcolbon, one of the main mining-affected areas, residents say that Lafayette has only brought drought and armed men and not community projects and prosperity to their village, Bautista said.

In a letter addressed to Lafayette Phils. Inc. General Manager for Operations Engr. Roger Corpuz and dated 12 September 2007, Rapu-Rapu Sangguniang Bayan Secretary Allan L. Asuncion noted that Manuel A. Belardo, Barangay Chair of Pagcolbon, expressed his “total dissatisfaction [of] the present scenario happening in [Pagcolbon] because of the inhumane system of [Lafayette]”.

Asuncion noted there was already “drought and scarcity or total absence of potable water supply to the residents of Barangay Pagcolbon” and “no proper coordination to the barangay council with regards to the projects of the company being implemented in Pagcolbon”.

In the letter, Asuncion noted that in the 10th Regular Session of the Rapu-Rapu Sangguniang Bayan last September 12, 2007, Belardo also expressed apprehensions on the “militarization or presence of civilians with high powered fire arms and uniformed personnel equipped with high-powered firearms without a name tag or any insignia.”

“Whether they are military or civilian personnel, the presence of heavily-armed men without any form of identification in the mining-affected communities is an alarming and illegal trend. This should be investigated as their presence violates the ongoing gun ban in respect to the pending barangay elections,” Bautista said.

Share This Post