An argument against forcing change: Transparency in mining royalties in Bataraza, Palawan

June 20, 2019

By: Adelle Chua


Chadwick Go Llanos has been working with indigenous peoples (IP) communities for more than a decade. As sub-national coordinator for Luzon and Visayas for Bantay Kita – a coalition of more than 80 civil society organizations advancing participation in the governance of natural resources – he has seen similar problems in different contexts addressed in various manners by wildly divergent groups and cultures.

After all these years, he has learned that even with the best intentions, one can never fancy oneself as bearing the magic solution to solve the problems of the community.

“Don’t look at yourself as somebody who can impose change. Don’t think you know better and that it’s your job to tell them what to do,” he says.

“Rather, be someone who journeys with the communities.”

Go Llanos’ latest journey is with the IP community in Bataraza town at the southern tip of Palawan province, where Rio Tuba Nickel Mining Corporation, a subsidiary of Nickel Asia Corporation, operates a 900-hectare nickel mining site. This community, Bantay Kita found, had minimal appreciation of disclosed mining data that may contribute to evidence-based decision-making for their collective, common good.

The project sought to improve the community’s understanding and appreciation through the enhancement and updating of a knowledge product, and through capacity building and orientation sessions.

Bantay Kita presents the knowledge product on indigenous people’s royalty payments in Filipino, English, and Palaw’an dialect to the IPDO leaders.


An institutional push for transparency

Section 2 of The Philippine Mining Act of 1995 says that it shall be the responsibility of the State to promote the rational exploration, development, utilization, and conservation of the country’s mineral resources through the combined efforts of government and the private sector. This is to enhance national growth in a way that effectively safeguards the environment and protects the rights of affected communities.

The mining law also provides that indigenous communities are entitled to 1.5% in social payments – royalties – upon the sales of minerals if the mining is operated within ancestral domains.

“That’s a lot of money we are talking about,” says Go Llanos.

Through the royalties, communities can derive benefits out of the resources that they share.

Then again, how the community actually benefits depends on how they are able to make productive and sustainable use of the funds, the information about which is contained in the PH-EITI reports.

The PH-Extractive Industries Transparency Initiative was established in 2013 through Executive Order 147 signed by President Benigno Aquino III. The EITI sets international standards for transparency and accountability in the extractive industries and in government.

PH – EITI issues reports that indicate the amounts paid by players in the extractive industries to the specific populations that their operations affect. It has a multi-stakeholder group that is intended to ensure broad participation by stakeholders, as prescribed by international standards.

Bantay Kita is a member of this multi-stakeholder group.

Chadwick Llanos (second from the left) from Bantay Kita, the Indigenous People Development Office (IPDO) of Barangay Rio Tuba, Bataraza, Palawan and Rio Tuba Nickel Mining Company discuss relevant disclosed Philippine Extractive Industries Transparency Initaitive (PH-EITI) mining data for the community

This is not the first engagement between Hivos Southeast Asia and Bantay Kita. In 2017, through the project Open Mining Governance in two municipalities in Cebu and Palawan, Bantay Kita “aimed to increase access, understanding and use of mining contracts data. In particular, it sought to empower BK affiliates to access, understand, and use relevant mining data to increase transparency and accountability in minerals management.”

This project built on the Hivos-Bantay Kita engagement in Bataraza town, and sought to address capacity gaps in appreciating information that is made available according to law.

Information made available includes mining contracts, mineral agreements, where, how big, what the payments are to the government, how much the government has received, what the reconciled amounts are, and whether there are discrepancies in the payments and receipts, according to Go Llanos.

But making the data available is not the be-all and end-all of the process.


Trudging through the challenges

At the outset, there were difficulties that made the project daunting. Foremost was the unwillingness of the IP community to open up to Bantay Kita as an organization about their concerns.

“If the communities are the ones that are resisting, it’s a difficult and long process,” Go Llanos says.

It took the graduate students of the Palawan State University as infomediaries to get them to talk about their situation and their sentiments. The PSU students were initially researching on the environmental impact of mining, but they were able to include issues important to the mining community, “They demonstrated the capacity to access, understand, and use mining data disclosed in the PH EITI report.”

The mining company, Rio Tuba, also helped bridge the community with other stakeholders.

It was revealed that the IP community had connectivity problems and this had trouble accessing the information. Even information available offline – through a book format, for instance, given to the LGUs – was not simplified for the understanding and appreciation of the communities.

Most of the reports were written in English, which is not the first language of those consuming the information. And then, the documents were voluminous, often containing graphs and figures. IPs were not able to grasp the entire scenario and what this meant in their own context, particularly planning on their expenditures for their sustainable benefit.

Worse, the community claimed there were discrepancies in the amount reported and the amount they actually received.

There could be a few explanations for this, Go Llanos says. First it could be just a timing issue. The royalties are allocated annually but the releases are done quarterly. Bantay Kita has agreed to write Rio Tuba so that the community could reconcile its payments and receipt before flagging EITI of the supposed discrepancy.

There was also a suggestion that IP leaders may not have been forthcoming to their communities. If this were indeed true, it might not because they were corrupt leaders per se but because of certain gaps in resource management, Go Llanos says.

Finally, the EITI bill, when framed as a piece of environmental legislation, moved slowly in the Committee of Natural Resources in the Senate. Thus, it had to be repackaged as a freedom of information measure with the help of FOI champion Senator Grace Poe.

Other concerns were the lack of resources on best practices on community outreach, knowledge product, presentation of data to specific audiences. Materials were not in the vernacular that community members could easily understand, and Bantay Kita had no office on Palawan.


Lessons learned

There are always new lessons to be learned, the foremost of which is that stumbling blocks are always opportunities.

“The one thing I like about engaging with Hivos is that there does not seem to be a hindrance for them,” Go Llanos says. “When you have reached something that appears to be a dead-end, you will say we may have hit a certain point and we might want to divert or change tack because we cannot go further using this approach.” This has led them to be creative in exploring solutions, especially since the outcome they were aiming for is a change in behavior.

Second, mining companies can be an ally. “We did not realize we could work together, because in many other cases, the mining companies tend to be on the other side of the fence. The common perception is that mining companies are the enemy.”

In this case, Rio Tuba Nickel Mining Corporation helped open spaces for the larger group. “During the focus group discussion, they had their community relations officers join us for them to understand the issues of the community, and that’s good.” He added that the community relations officers offered to ensure that the data and the infographics found their way to community members.

Empowerment takes time– and participation. There was a perception among the community that their IP leaders have not been forthcoming to them. “My assumption based on what I see is, you have IPs given a big amount of money. Prior to that, they have not been given the capacity to manage these resources. It’s easy to just spend that amount, and if you do not account for a good, sustainable planning system, or investments like education which is more sustainable that other things, you will have that particular problem.”

“Maybe along the way a good plan went awry, so they cannot tell their communities that the money that they intended for good purpose ended up not being put to good use.”

“To solve this at once, it is always tempting to just hire somebody who will draw up a plan and execute it for you. It’s faster,” Go Llanos says. The same applies to the IPS who find themselves with resources that they are not able to aptly manage because of a certain capacity gap. “They may not be opportunistic people per se, but they become prey to opportunities that arise with money.”

The real solution would be to develop capacities, but this could take long. “You may eventually want to cut short the process by getting somebody from outside. You have good intentions and you figure it’s good for them anyway. But it’s not inclusive and it’s not participatory. The rest of the community will have no buy in. Because you are not able to communicate the rationale of your plans and consider their input, the community will not respond accordingly.”

Progress comes through pathways and open spaces. Different people see projects from their own perspectives and contexts. “When you have problems, you talk about them. Bring them up, raise your questions, and ask the other parties: What do you propose to do?”

Even the finding that the money had not been used optimally because of capacity gaps can be straightened out in this manner. “This leads to respect which might really change behavior.”

What Hivos provided, first and foremost, were pathways and open spaces.

“Even debacles which you did not anticipate can give you an opportunity to learn and to interact with other actors. Now we have a platform to work together and this is really a good thing,” he says.

Persistence pays. “In communicating with IPs, in the beginning they will say ‘no’” Go Llanos says. “But maybe the second time or third time, they will go from ‘we won’t work with you’ to ‘we will make you observe our process of checking data.’”

This is the farther they have ever gone in reaching out to the community. “I am excited!”

Officers of the IPDO participate during the presentation of the knowledge product in Bataraza, Palawan

An active stance is always better than a passive one. During the course of the project Bantay Kita unearthed some areas for improvement, for instance that the National Commission for Indigenous Peoples (NCIP) should take a more active role in ensuring that the community’s well-being is being upheld. “We hope they could change the approach of being bureaucratic and doing things by the book to become a body that is immersed in the different IP realities even as these realities vary from one community to the other.”

Finally, you can’t force maturity. “My work with the IPs has caused me to grow a lot of white hair,” Go Llanos says. “But in general, I feel positive. You get that feeling when you do not look at yourself as the one to impose change, but one who makes the journey with communities. You don’t tell them what to do. Instead you yourself become part of that change.”