PH is 3rd worst in world mining

PH is 3rd worst in world mining
by Mitchell Confesor

MANILA — The Philippines has become the third worst place for mineral explorers and investors, just behind Venezuela and Kyrgyzstan as the worst in mining investments, according to the annual survey of a Canada-based think tank for the 2013-2014 period.

In the policy perception index of the Fraser Institute annual mining survey, the Philippines further slips to the Bottom 3 for 2013-2014, specifically in 110th place out of 112 areas surveyed.

This is a slide from the Bottom 14 in 2010-2011 (66th out of 79 places), to the Bottom 6 in 2011-2012 (88th out of 93), before slightly improving to the Bottom 9 in 2012-2013 (88th out of 96).

Four years ago, the Philippines in fact also ranked the third least attractive at 70th place among 72 areas, based on index potentials in government mining policies and mineral explorations, according to the 2009-2010 edition of the Fraser Institute survey.

Last year’s least wanted country for miners, Indonesia, was at the Bottom 10 in 2010-2011 (70th out of 79 places) to the Bottom 9 in 2011-2012 (85th out of 93), then becoming last in 2012-2013 (96th out of 96), and now again at the Bottom 9 in 2013-2014 (104th out of 112).

Kyrgyzstan, Venezuela, and the Philippines is followed in the bottom ranking this year with La Rioja in Argentina, Angola (new addition to the list), Mendoza also in Argentina, Zimbabwe, Ivory Coast (another new addition), Indonesia, and Madagascar.

Aside from Angola (108th) and Ivory Coast (105th), the other new additions to the survey are Sierra Leone (96th), Uruguay (82nd), Saudi Arabia (81st), Nicaragua (80th), Kenya (79th), Ethiopia (78th), Mozambique (76th), Nigeria (75th), Fiji (73rd), Malaysia (69th), Myanmar (67th), Liberia (66th), Eritrea (52nd), Thailand (50th), Portugal (42nd), and France (18th).

Perennial dropper Kyrgyzstan, from the Bottom 7 two years ago (87th of 93) to the Bottom 5 last year (92nd out of 96), is now dead last at 112th out of 112.

Venezuela, from the Bottom 2 three years ago (78th out of 79) to the Bottom 4 two years ago (90th out of 93), to the Bottom 3 last year (94th out of 96th), is down again to the Bottom 2 at 111th out of 112.

Honduras, after being the worst for two years in a row, being at 79th out of 79 three years ago and 93rd out of 93 two years ago, improved last year at 83rd out of 96 but slipped a little this year at 101st out of 112.

However, the Philippines is in the Top 6 based on the Fraser Institute best practices mineral potential index, which rates a region’s attractiveness based on the perceptions of mining company executives of a jurisdiction’s geology, and on pure mineral potential that is independent of any policy restriction.

Topping the best practices mineral potential index are Alaska in the United States, Western Australia, Nevada also in the U.S., Chile, and British Columbia in Canada, followed by the Philippines, the Yukon also in Canada, Greenland, and Newfoundland & Labrador as well as Manitoba in Canada.

Best for miners

Top 1 Sweden, which was Top 2 last year, went up from a consecutive Top 7 ranking three and four years ago.  Top 2 Finland, trading places with Sweden from being Top 1 last year, was also Top 2 a couple of years ago.

“The confidence mining executives have in Sweden and Finland, for example, proves that it’s possible to enact sound environmental protections and still maintain a successful mining industry,” said Kenneth Green, senior director of energy and natural resources for Fraser Institute and director of its Survey of Mining Companies 2013.

Alberta in Canada is Top 3 for the past three years after being No. 1 four years ago, but Quebec further dropped from being No. 1 from 2007 to 2009, then to 5th in 2011-2012, 11th in 2012-2013, and finally 21st worldwide in 2013-2014.  Fraser Institute attributed this in part to amendments in Quebec’s mining act and its recent tax policy changes.

“Miners praise Alberta for its transparent and productive approach to mining policy. The province offers competitive taxation regimes, sound legal systems, and relatively low uncertainty around land claims. That’s what miners look for,” Green added: “If Quebec wants to renew confidence in the global mining sector, it should reduce red tape, minimize the risk associated with policy changes and tax increases, and respect negotiated contracts.”

Ireland is up to Top 4 after being Top 6 last year and Top 9 two years ago.  Wyoming in the U.S. has remained steady the past two years at Top 5.  Western Australia is up to Top 6 this year from Top 15 last year.

New Brunswick in Canada meanwhile is down to Top 7 this year after being Top 4 last year and Top 1 two years ago.  Newfoundland & Labrador, also in Canada, is up to Top 9 this year from 18th place last year, while the Yukon in Canada slides down to 19th place this year from Top 8 last year.

Nevada in the U.S. slightly slips to Top 8 this year from Top 7 last year, while Utah further slips to 16th place this year from Top 9 last year.  Norway has remained steady the past couple of years at Top 10.

To sum up the past six annual surveys, the Philippines ranked 110th out of 112th this year (2013-2014), 88th out of 96 last year (2012-2013), 88th out of 93 the other year (2011-2012), 66th out of 79 three years ago (2010-2011), 70th out of 72 four years ago (2009-2010), and 59th out of 71 in the 2008-2009 edition.

For the first time since the Fraser Institute survey began, the researchers have included a new question on public opposition to mining and its effect on permitting and project approval.

On a chosen per-country assessment, Fraser Institute quoted an unnamed company president of an exploration company as saying that in the Philippines, there is an “inordinate amount of time in lifting (a) moratorium on exploration applications,” adding “two years of inaction has [sic] negatively impacted on sentiment.”

It also quoted the senior management from an exploration company as saying: “They throw arbitrary conditions into licenses on a take-it-or-leave-it basis.  The Mining Act of 1995 provides that the ‘community’ grants its full and implied consent over mining activities, so the ‘community’ demands more and more.  It’s an impossible system and provides no security for foreign investment.  The locals hold companies up for endless demands, always with the implication that they’ll withdraw their consent for your project.”

The newest survey now includes data on 112 jurisdictions worldwide, on every continent except Antarctica, including sub-national jurisdictions in Canada, the U.S., Australia, and Argentina.

Just above the Philippines in the Bottom 4 is the Argentinean sub-national jurisdiction of La Rioja, one of the 2012-2013 additions to the Fraser survey, and in the Bottom 5 is new addition Angola.

And at the Bottom 6 is one of the 2011-2012 additions to the Fraser survey, the Argentinean sub-national jurisdiction of Mendoza, added two years ago together with Catamarca, Chubut, Jujuy, Rio Negro, Salta, San Juan, and Santa Cruz.

Another 2012-2013 Fraser survey addition, La Rioja’s fellow Argentinean sub-national jurisdiction of Neuquen, slipped from 39th out of 96 last year to the Bottom 11 this year at 102nd out of 112th.

Other new additions last year basically ranked the same this year: Greece (87th to 89th), Serbia (52nd to 55th), and French Guiana (27th to 35th).

The lead authors of the 2013-2014 survey are Alana Wilson and Miguel Angel Cervantes, who has co-authored the previous Fraser Institute mining surveys.  The 2013-2014 survey was released on March 3 [Western Canadian time, Monday], or March 4 [Tuesday] in Manila.