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An Anarchist and Autonomous Community-Based Resource Center in Muntinlupa City (Manila south), Philippines

BREAKING NEWS! MINING IN THE PHILIPPINES — Glencore promises to demilitarize Tampakan?

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Alarmed by the deteriorating situation, Glencore’s Swiss office sent out a message through a courier and through this writer to the Tampakan Forum, a coalition of international and local NGOs and the Church opposing the Tampakan mine project. The concern was triggered by two articles.

The first is an article (Appendix A below) that reports that Glencore-Xstrata-SMI was funding military and CAFGU operations in the mine site area, according to a recent congressional hearing. The second is another article (Appendix B), which relates the funding of the military to the massacre of the family of a B’laan chieftain leading the anti-mining protest, and which reports that charges have been filed against military personnel in court.

The gist of the Glencore message was as follows – 1) Glencore has not taken over the project yet, implying that such a controversy is something they inherited from the actions of Xstrata-SMI before the Glencore-Xstrata merger; 2) Glencore promises that, when its management takes over, it will start from zero, meaning, it will reinvestigate and re-do all requirements, such as ECC documentation and application; 3) Glencore does not believe in military presence in the mine site and will demilitarize when it takes over. Three Tampakan Forum members give their comments on these Glencore messages. One member says, based on the track record of Glencore worldwide, this promise to demilitarize is welcome, but is doubtful and remains to be seen.

A second member was quick to say that, “We do not place too much trust in the statements by Glencore managers. Glencore has a worse record than Xstrata, as far as the environment and Human Rights are concerned. I believe that they were even named in a UN report on Human Rights in the Democratic Republic of Congo.” In other words, there is a perception that Glencore and Xstrata are the same banana in terms of handling social, human rights, and environmental issues.

A third member commented that “the exposed linkage to military and paramilitary funding is worrying them (Glencore) …. The international investors may shy away from a project with this profile. So what we must do is (to) not rely on any company quiet words and non-public commitments.

He adds that in an earlier meeting with international oppositors, Xstrata said the same thing that Glencore is saying now, that “they (Xstrata) would scrap all existing assumptions (of previous owners of the mining application) and start again on assessment of the project and the whole community consent.” This has not made the project more viable and in fact worsened the situation when the reports of corporate funding of the military and the massacre of the family of the protest leader came to light.

The comment continues that high up in the corporate ladder, the concern of equity holders is profitability, but at the lower rung, the concern of managers shifts to personal survival (i.e. continuity of the project), where there is a tendency to suppress opposition rather than report it upstairs. This insulation between investors and field managers results in critical misinformation, the presentation of a rosy picture and the non-disclosure of facts to prevent the project from being scuttled. Stock market investors thus do not always know that their money is funding human rights abuses. Major stockholders may or may not know.

“There will be little trust, and both at individual and corporate levels, there will be rivalries and self-interests at work. That is the core of capitalism. So Glencore’s new team will want to be seen as different so that they can claim the benefit for changed/improved situation. And they won’t trust Indophil, much especially if they just boosted their share price by exposing the project to public attention at this sensitive time.”

Lesser investors like Indophil Australia is celebrating the short term victory of a stock market short-term gain. As soon as the ECC approval was announced, prices rose from 21.1 cents to 34 cents. For larger investors like Glencore and Xstrata, this is a minor concern in the bigger picture and the ECC means nothing to them because they will have to re-do it.

Below is a description of the complex ownership of Glencore-Xstrata-Indophil-SMI currently, as given by an SMI source. The names of Manny Pangilinan, Ramon Ang, Henry Sy, Tom Alcantara, and Paul Dominguez appear in the ownership structure. The last two are the owners of Alsons, a power plant generator, with plans to service 100 mega-watts exclusively for the Tampakan mine when it operates. (Sonny Dominguez, brother of Paul, led the team contracted by Glencore for 15 years to manage Pasar, which it owns. The team later was replaced due to disagreements over management policies.)

Saggitarius Mining Inc. (SMI) ownership –
1) 60% “Tampakan Group of Companies” – 120 individual Filipino investors (names not known, possibly many are a front for foreign ownership, a common practice among multintationals); 2) 35% Xstrata; 3) 5% Indophil.

Indophil ownership (unverified, source SMI) –
1) 4% Philex and/or PLDT (Manny Pangilinan); 2) 4% San Miguel Corporation (Ramon Ang); 3) 20% Alsons-BDO (Alson is Paul Dominguez-Tom Alcantara; the wife of Paul is the sister of Tom) (BDO is Henry Sy; note Alson’s loan from BDO was possibly converted to equity; 4) 19% Xstrata; 5) the rest of public ownership unknown.

The Tampakan Forum is taking with a grain of salt the Glencore pronouncements. But if it is able to sincerely demilitarize the project site immediately and unilaterally, this will be extremely welcomed. But will they do it?

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2 comments on “BREAKING NEWS! MINING IN THE PHILIPPINES — Glencore promises to demilitarize Tampakan?

  1. tae
    March 18, 2013

    sana ay merong tagalog/pinoy bersyon para maintindihan ng hindi marunong magbasa ng ingles. base sa pagkaintindi ko, me nangangako ng imposible at meron ding nagpapauto.

  2. hannah sagrado
    May 5, 2013

    the sad thing with this mining thing is when it is over. what happens to the people then? they are left to fend off for themselves against the consequences of thereckless exploitation of the lands’ natural resources

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