Mine firm contests P1 billion fine

PHILEX Mining Corporation is contesting the P1 billion fines slapped by the Mines and Geosciences Bureau (MGB).

Michael Toledo, senior vice president for Corporate Affairs, said the report of the MGB showed there was no negligence from the part of the company in the leaks suffered by Tailing Pond 3 of the mining company. In fact, a force majeure was admitted by the bureau.

Toledo said despite the report absolving the mine company from negligence, the billion peso fine was still imposed.

“We will be responding to the report of the MGB and contest the imposition of a P1,034,358,971 fine on the company,” he said.

Toledo added, “The MGB itself has effectively confirmed that the spill was caused by force majeure in the form of the historically unprecedented heavy rains generated by typhoon Gener at the Padcal site.”

Rainwater reached 331.80 millimeter (mm) on the day of the spill, exceeding by almost 100 mm the 50-year rainfall record for Padcal of only 234.50 mm for a single day.

“It is grossly unfair to penalize Philex and impose a huge fine on them when the government agency imposing the fine itself has confirmed that Philex is just a victim of force majeure or an act of nature over which it had no control,” he pointed out.

Toledo said one of the most basic principles of fairness and of law is that no party should be held responsible or be penalized for events beyond its control.

“In fact, this is so basic that even Philex’s MPSA with the government exempts Philex from the performance of its obligations if the cause is force majeure and so, outside Philex’s effective control,” he added, referring to the Mineral Production Sharing Agreement.

Toledo said the MGB has confirmed Philex has a system in place for the maintenance and monitoring of its Tailings Pond No. 3 (TP3) and secondary facilities during the accidental discharge of sediment in Padcal on August 1, and that its personnel were diligent in the performance of their duties.

“The findings came as no surprise because the company’s environmental management system, including the operation and maintenance of TP3, has long been ISO-compliant and –certified,” Toledo said.

However, he said the company is not wavering on its commitment to clean up the Balog river, and compensate workers and affected residents.