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SC asked to stop new gov’t bid for gold-rich Diwalwal

By Benjamin B. Pulta

12/01/2008

A local mining firm is asking the Supreme Court (SC) to stop a new government attempt to bid out on Wednesday portion of the 8,100-hectare Diwalwal Mineral Reservation in Mindanao due to a pending case before the tribunal over the property.

In a six-page urgent motion, Southeast Mindanao Gold Mining Corp. (SEMGMC) said the tribunal should exercise its injunctive power to prohibit the Department of Environment and Natural Resources (DENR) and its corporate arm, the Philippine Mining Development Corp. (PMDC) from prematurely putting for bidding the development of 1,620-hectare “Upper-Ulip Paraiso” site in Mt. Diwalwal on Dec. 3 or Dec. 8 until such time that the court resolves the pending case.

SEMGMC said the DENR is undermining the high court’s authority.

Companies that were shortlisted for the bid included MTL Philippines Inc, a unit of Britain’s

Metals Exploration Plc, China Sci-tech Holding Ltd in a joint venture with Songxian Fengyuan Molybdenum Industry Co and Hangzhou Jiantong Group Co in alliance with local firm Mt Apo Mining Development Corp.

South Korea’s Junheung International Co Ltd is also expected to bid as well as Philippine firms Mt Sinai Mining Exploration and Development Corp and Karanglan Resources and Mining Corp.

The mining areas in Mt. Diwalwal is one of the controversial four projects, including the cancelled ZTE-National Broadband Network, covered by a memorandum of understanding (MOU) between the Philippine government and ZTE International Limited, which was signed on July 12, 2006.

EMGMC earlier asked the SC en banc to reverse the June 23, 2006 decision of the Court’s First Division that cancelled all mining operations within the Diwalwal Gold Rush Area, which apparently paved the way for Malacanang through Trade and Industry Secretary Peter Favila to negotiate “hurried deals” with controversial Chinese firm, ZTE Corporation, to mine gold in the 8,100-hectare mine site.

The mining firm informed the high court that this was not the first time that the Executive department has degraded the authority of the High Court, citing the signing of the MOU in 2006 between Favila and ZTE International in which the government committed the granting of whatever permit was necessary to implement the projects in the agreements, including the mining areas in Mt. Diwalwal.

Favila himself admitted during the Senate hearing in connection with the ZTE-NBN deal that on July 12, 2006 he signed an agreement with ZTE International Investment Limited covering the exploration, development and operation of mining areas in Diwalwal.

“In defiance of the Court’s authority, the PMDC has committed and continuously committing a contumacious act in bidding out the development of a portion of the 8,100 hectares covered by Presidential Proclamation No. 297,” SEMGMC stressed.

Presidential Proclamation 297 issued in 2002 excludes an area of 8,100 hectares located in the Agusan-Davao-Surigao Forest Reserve, known as the Diwalwal Gold Rush Area, and proclaimed it as a mineral reservation.

However, Executive Order 318 issued on June 9, 2004 requires an act of Congress to reclassify forest reserves and not through presidential proclamation.

Because of this conflicting mandate, the Court en banc has been asked to rule which of EO 318 and Proclamation 297 is valid.

“The act of PMDC of bidding out mining operations within the area covered by Presidential Proclamation No. 297 is an affront to the Court’s judicial authority over the issues raised in the instant petitions. The validity of Presidential Proclamation 297 is still sub judice before this Court,” it said.

According to the mining firm, in order not to render the case moot and academic, TRO or a writ of preliminary injunction should be issued enjoining the DENR and the PMDC from taking any action that would pre-empt the resolution of the issues raised in this case.

“In the event that the bidding is conducted on December 3, respondent SEMGMC further prays that said bidding and any award as a result thereof be nullified, there being no valid subject of the bidding as long as the present petitions remain unresolved,” it added.

SEMGMC said the DENR is undermining the authority of the high court when they initiated the bidding process for the portion of the 8,100 forest reserve, which was subsequently declared as mineral reservation through Presidential Proclamation 297, whose constitutionality is one of the issues raised before the SC.

Whether these contumacious acts of PMDC are calculated to render moot and academic the issue of constitutionality of Presidential Proclamation 297, the same should not be countenanced, the mining firm said.

“Thus, not only is it premature to bid out the area for development, it is presumptuous to say the least considering that the Court may declare unconstitutional Presidential Proclamation 297. What then of the contract for the development offered for bidding by PMDC,” the mining firm added.

SEMGMC also prodded the SC to issue a show cause order why DENR and PMDC officials led by Environment and Natural Resources Secretary Joselito Atienza should not be cited for contempt for starting the bidding process for the exploration and mining operations of the portion of Mt. Diwalwal mining site, despite the pendency of the legal dispute on the matter.

Earlier, SEMGMC filed a manifestation with the SC about the DENR and PMDC’s plan to bid out the disputed mineral reservation located in Monkayo, Compostela Valley, saying the act “constitutes a contumacious act which is within the Court’s power to punish.”

The firm lamented that the PDMC’s act of bidding out the contested mining areas is not only “an affront on the Court’s judicial authority” over the pending consolidated cases, but it also shows that “as if the DENR and the PDMC are so sure of the outcome of the case that they decided to bypass the Court’s jurisdiction.”

The July 12, 200 agreement was entered into by Secretary Favila for the Republic of the Philippines while the issues on priority rights and the constitutionality of Presidential Proclamation No. 297 are yet to be resolved by the Supreme Court.

“Consistent with its past acts, the DENR and the MAB in bidding out the area subject of these petitions, is resorting to their usual machinations to confuse and to pre-empt the resolution of the consolidated cases by the Court,” the movant said.

The mining firm has asked the SC to reverse the 2006 decision of the First Division that overturned the rulings handed down by the panel of arbitrators (PA) and the Mines Adjudication Board (MAB) of the Department of Environment and Natural Resources (DENR) and the Court of Appeals (CA). It said that the decision reversed the full court ruling handed down by the SC in 1991.