Mining giant BHP Billiton pulls out of disputed Philippine project

Anglo-Australian mining giant BHP Billiton has cut ties with a controversial nickel mining project on a Philippine island community, butCAFOD continues call for new consent process.

The project funded and operated by BHP Billiton and worth US$22.7 billion, came under heavy criticism from a CAFOD report over allegations of bribery by BHP Billiton’s local joint venture partner AMCOR. BHP Billiton has sold its stake in the project to AMCOR.

As part of the Unearth Justice campaign, CAFOD is reiterating its call for a new, independently monitored community consent process to be carried out before any mining goes ahead in Macambol.

BHP Billiton's distancing of itself from this project is not the end of the story. The people and environment of the Philippines are still at risk from poor practices within the mining industry.

Sonya Maldar, CAFOD

CAFOD's extractives policy analyst Sonya Maldar said: "Despite BHP Billiton's withdrawal from the Hallmark project, it looks like the company's former partners will proceed with the nickel mine.

"Given the serious flaws in the official consent process, AMCOR and any future partners in the project cannot use this to push ahead with mining in the area. There must be a new consent process that is genuinely free and fair before any mining can proceed at Macambol.

"The community should be given sufficient information about any new project and all its potential impacts so they can make an informed decision about whether it should go ahead or not."

Allegations of bribery

BHP Billiton's withdrawal from the project follows a series of disputes with former partner company AMCOR and a dip in nickel prices.

CAFOD's 2008 report Kept in the Dark documented instances of bribery by AMCOR and government officials of local people to back the mine project. Also highlighted were flaws in the consent process, lack of transparency and the potential impact on the environment.

Lilia Paglinawan of the Interfaith Movement for Peace Empowerment and Development (IMPEDE) in the Philippines said “We fear the impact of this huge mining project on the environment and the livelihoods of the farmers and fishermen in Macambol and beyond.

"Before the government approves AMCOR’s activities, there must be an independent study of the impacts of this project on the nearby Pujada Bay and Mount Hamiguitan protected areas. This information must be made available to those who stand to be affected by the project.”

Sonya Maldar added: "BHP Billiton's distancing of itself from this project is not the end of the story. The people and environment of the Philippines are still at risk from poor practices within the mining industry.

“Despite claiming to be an industry leader, BHP Billiton’s management failed to ensure that the company and its partners met the highest standards at the Hallmark project and this impacted on its licence to operate in Macambol. These issues, which are often seen as more marginal to a good business model, can develop into serious business risks if left unaddressed, leading to loss of investment to shareholders.”

Anglo-Australian mining giant BHP Billiton has cut ties with a controversial nickel mining project on a Philippine island community. The project funded and operated by BHP Billiton and worth US$22.7 billion, came under heavy criticism from a CAFOD report over allegations of bribery by BHP Billiton’s local joint venture partner AMCOR. BHP Billiton has sold its stake in the project to AMCOR.

But CAFOD is reiterating its call for a new, independently monitored community consent process to be carried out before any mining goes ahead in Macambol.

CAFOD's extractives policy analyst Sonya Maldar said: "Despite BHP Billiton's withdrawal from the Hallmark project, it looks like the company's former partners will proceed with the nickel mine. Given the serious flaws in the official consent process, AMCOR and any future partners in the project cannot use this to push ahead with mining in the area. There must be a new consent process that is genuinely free and fair before any mining can proceed at Macambol.

"The community should be given sufficient information about any new project and all its potential impacts so they can make an informed decision about whether it should go ahead or not."

BHP Billiton's withdrawal from the project follows a series of disputes with former partner company AMCOR and a dip in nickel prices.

CAFOD's 2008 report 'Kept in the Dark' documented instances of bribery by AMCOR and government officials of local people to back the mine project. Also highlighted were flaws in the consent process, lack of transparency and the potential impact on the environment.

Lilia Paglinawan of the Interfaith Movement for Peace Empowerment and Development (IMPEDE) in the Philippines said: "We fear the impact of this huge mining project on the environment and the livelihoods of the farmers and fishermen in Macambol and beyond. Before the government approves AMCOR’s activities, there must be an independent study of the impacts of this project on the nearby Pujada Bay and Mount Hamiguitan protected areas. This information must be made available to those who stand to be affected by the project." Read blogs from IMPEDE.

Sonya Maldar added: "BHP Billiton's distancing of itself from this project is not the end of the story. The people and environment of the Philippines are still at risk from poor practices within the mining industry. Despite claiming to be an industry leader, BHP Billiton’s management failed to ensure that the company and its partners met the highest standards at the Hallmark project and this impacted on its licence to operate in Macambol. These issues, which are often seen as more marginal to a good business model, can develop into serious business risks if left unaddressed, leading to loss of investment to shareholders."

Notes to editors: For more information contact Pascale Palmer +44 7785 950 585