Solons want to probe mining deal between govt and private firm

Lawmakers called for a congressional probe into the failure of a private mining company to pay the $263 million it owes the Philippine government after it bought in 1996 the state’s shares from Nonoc Mining Industrial Corp. (Nonoc) operating in Surigao del Norte.

In House Resolution 1408, Reps. Rufus Rodriguez (2nd District, Cagayan de Oro) and Maximo Rodriguez Jr. (Party-list, Abante Mindanao) asked the House Committee on Good Government to invite the officials of Philippine Industrial Corp. (PIC) and Nonoc, the Department of Finance, the Privatization Management Office and the Mines and Geoscience Bureau (MGB) to the inquiry to shed light on the matter.

“Of the $263.8 million it owes the government, PIC only paid $1.25 million since 1996. The government can still collect more than $262 million from the company or about P1.1 billion,” Rodriguez said.

Rodriguez said PIC, a Philippine corporation engaged in mining activities in Surigao del Norte, bought government’s interest worth $264.8 million in Nonoc Mining Industrial Corp. (Nonoc), which holds mining rights in the area.

The purchase agreement was undertaken on an Amended and Restated Definitive Agreement (ARDA) executed by the officials of PIC and Nonoc in 1996 and the government through the Asset Privatization Trust, now the Privatization Management Office, Rodriguez said.

Rodriguez said Finance Secretary Cesar Purisima explained that the ARDA was executed after the PIC defaulted on a previous agreement with government, which revoked the original mineral production sharing agreement.The Mines and Geosciences Bureau (MGB) has recently suspended the operations of PIC and also issued an order stopping the mining firm from operating and transporting mineral resources, according to Rodriguez.

“The MGB also ordered the PIC to give an explanation on why its mineral production sharing agreement with the government should not be revoked,” Rodriguez said.

Rodriguez said “Congress should determine why it took more than 10 years before the mining license of PIC was suspended by MGB.”

He stressed the need for Congress to look into possible collusions or other anomalous agreements entered into by PIC and government entities.

“There is also a need to look into the capability of PIC to settle its obligations with the government and see if its mining license will be re-issued or if it has to be bid out to other corporations,” Rodriguez said.

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