(Quezon City, 04 March 2025)–The controversial P4.42-billion loan invested by the Maharlika Fund in the copper-gold project of the Makilala Mining Corporation can result in billions of pesos in environmental damages, according to the legal, policy and advocacy group Legal Rights and Natural Resources Center (LRC).
“The P4.42-billion Maharlika Fund investment translates into a potential P31.15 billion cost of environmental damages based on a global benchmark established in a scientific study1. This is on top of the fact that more than P4 billion of public interest funds that should have been spent on actual social services and sustainable development needs were diverted to a destructive mining project,” said Atty. E.M. Taqueban, executive director of LRC.
Based on the said life cycle assessment of the mining industry, the projected annual global cost of mining damages reached up to US$ 5.19 trillion per year. Comparing this to the mining industry’s total global capitalization of $737 billion in 20242, the Center estimates that for every $1.00 of mining capital, there is a resultant $7.00 in damages. Even considering the lowest and median projections of the study would result into $0.50 to $3.80 in damages, which means even the lowest risk scenario would result in the offset of 54% of global mining revenues, and negation of global net profits3 by six times its amount.
The Center also pointed out that the beneficiary mining company was a subsidiary of an Australian mining firm, Celsius Resources, Ltd., essentially subsidizing a foreign mining company instead of attracting foreign investments as promised by the Fund.
“Filipino taxpayers are basically bearing the burden of de-risking a clearly high-risk foreign mining project that is projected to cause both ecological and economic losses. The only way for this mine to be profitable is if the costs are externalized—meaning the polluters will not be made to pay,” explained Atty. Taqueban.
“It is time for the Philippines to break away from this self-reinforcing economic and ecological trap. We advocate for the passage of House Bill 11008 or the Alternative Minerals Management Bill (AMMB), which aims to reorient the mining industry away from the current extractivist framework towards an ecologically-sound and needs-based National Industrialization Program,” she ended.
The AMMB4, a longstanding proposed law first filed in Congress in 2009, also aims to bolster environmental regulations through the requirement of an Environmental and Social Impact Assessment and Mitigation Plan, which includes human rights impact assessment, and the creation of Multi-Sectoral Mineral Councils (MSMCs) that ensure a democratized governance of mineral areas.#
1 Rosalie Arendt, Vanessa Bach, Matthias Finkbeiner, The global environmental costs of mining and processing abiotic raw materials and their geographic distribution, Journal of Cleaner Production, Volume 361, 2022, 132232, ISSN 0959-6526, https://doi.org/10.1016/j.jclepro.2022.132232. (https://www.sciencedirect.com/science/article/pii/S0959652622018376)
2 Rossouw, A., Appiah, G., Baskoro, G., Finckh, U., Levine, L., Lundie, D., Rosa, J., Sanin, A., Schmidt, A., Schrap, L., Soliz, D., Thomas, N., and Williams, M. (2024). Mine 2024: 21stedition – Preparing for impact. Pricewaterhouse
3 Ibid
4 House Bill No. 11008 Text as Filed in Congress: https://docs.congress.hrep.online/legisdocs/basic_19/HB11008.pdf
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