Oh the old how long is a piece of string question.
The operations at the Didipio mine were effectively shut down back in October 2019 after several weeks of difficulties with protesters and local officialdom.. So here we are now in March with no clear understanding of where things are at and how much longer things will be delayed before we get a decision one way or the other. That is a period of 6 months with nothing happening at the mine.
About a year before last October OGC had begun the process of getting a renewal to the next 25 year period of the FTAA (Financial or Technical Assistance Agreement) which was due to expire earlier in 2019. Despite a recommendation for it to be approved apparently from these agencies as reported in a Reuters article :-
The Philippines’ Mines and Geosciences Bureau, the industry watchdog, and the Department of Environment and Natural Resources had endorsed OceanaGold’s application for FTAA renewal to President Rodrigo Duterte’s office.But Duterte’s office had found the application incomplete and sent it back.
Now Duterte is on record as being against some of the past displays of poor mining operations throughout the Philippines and has warned of closing down those that don't clean up their act. Whether it suits him to hold up approval so that he can claim to be a hard man on the mining industry and does not want to be seen approving a 25 year renewal too quickly. The longer he delays and makes life difficult for OGC then his reputation as being willing to support local environmental protesters is enhanced.
Or is it also the problem of the way the Philippines authorities work or act in a dysfunctional manner. Corruption is certainly recognized as an endemic problem at various levels and bribery to oil the machinery is par for the course.
Will OGC get approval for its application for the FTAA ? Oh dear ? There are several scenarios I can think of here.
- First scenario : Approval from Duterte drags on deliberately to the point that OGC puts Didipio on care and maintenance which effectively closes down the mine for months into the future ( a lot of time to get it back up and running even when approval may be finally granted.) So out of commission well into 2021.
- Second scenario : Approval from Duterte drags on but approved after further discussions at the 11th hour just before OGC puts mine on care and maintenance. Again no disgrace for Duterte. But mine only just gets back to start to gear up again by say October this year.
- Third scenario: Approval from Duterte's office during April but with plenty of hard line comments and warnings. Things gear up by May/June.
- Fourth scenario : Approval from Duterte not granted. Notice given to all other mining operations in Philippines to sharpen up their performance or else.
Now some of those scenarios are pretty wild but anything is possible.
In my opinion I think there will a further period of delay. But eventually Duterte will give approval (I hope). OGC is running a pretty sound operation so far as mining operations go despite the voiced opinions by some posters here. OGC does have the credentials and awards to back it up so it is not a rough and ready operator.
