Mining stocks surge as Gina Lopez loses DENR post
MANILA, Philippines – Share prices of mining and oil stocks in the Philippine Stock Exchange (PSE) were the only ones that ended on the green on Wednesday, May 3, surging by 2.73%, a few hours after staunch anti-mining advocate Gina Lopez lost her post as the country's environment secretary.
Mining and oil, which consist heavily of miners, earned 339.02 points, ending at 12,772.82 on Wednesday. This is while the rest of the indices were down, causing the PSE index to decrease by 0.27% to 7,682.26 on the same day. (READ: Are the odds stacked against Gina Lopez in the CA?)
For Guian Angelo Dumalagan, market economist at Land Bank of the Philippines, the surge in mining and oil stocks is likely because the Commission on Appointments (CA) rejected the ad interim appointment of Lopez after 3 confirmation hearings.
"Previously, the mining and oil index suffered due to the closure of many Philippine mines under her leadership. With the rejection of her appointment as Department of Environment and Natural Resources (DENR) chief, the outlook for the Philippine mining sector has improved significantly, driving stocks higher," Dumalagan said.
Wednesday's 2.73% gain and the 3% increase on Tuesday, May 2, are "quite significant, as the mining and oil index has never surged above these levels since the start of the year," Dumalagan added.
Lopez's appointment as DENR chief in June 2016 had mainly caused the mining and oil stocks to dip to their lowest growth rate since August 2015.
Lopez was criticized by several miners after her controversial orders to close down or suspend mining operations in the country, cancel mineral production sharing agreements, and most recently, ban "prospective" open-pit mines.
'Business as usual'
For Philex Mining Corporation, "it is still business as usual," said Michael Toledo, the company's senior vice president for public and regulatory.
"We were one of the few companies who successfully passed the mining audit. We continue to maintain our adherence to the highest international standards and practices as a responsible miner, not just for ourselves but for our stakeholders dependent on our mining operations. We hold ourselves out to continually raise the bar of public perception on mining," Toledo said in a text message.
He added that Philex Mining respects the decision of the CA. "We acknowledge the passion with which to care for the environment and natural resources that Ms. Lopez has. Hopefully this will not deter her from continuing her crusade for the environment."
Philex Mining chairman Manuel Pangilinan had said his company will have to suspend its $1.2-billion Silangan project in Surigao del Norte, in light of Lopez's order to ban prospective open-pit mining.
Chamber of Mines of the Philippines (COMP) vice president Ronald Recidoro said in a separate interview that his group will ask the government to review the policy on banning prospective open-pit mines.
"The rejection is a victory for due process. The next step really is to push for a new secretary of environment that will be more open not just to environmental protection but also to natural resource development, and to seek a review, and a reversal, of all the negative orders issued by Lopez in the last 10 months," Recidoro said in a phone interview.
For JB Baylon, Nickel Asia Corporation vice president for communication, his company remains focused on "doing the right things, which have merited praise from Gina Lopez herself."
A unit of Nickel Asia, Hinatuan Mining in Surigao del Norte, was ordered closed last February 27. But the closure and suspension orders are still being reviewed by the Mining Industry Coordinating Council (MICC). – Rappler.com