WTI Crude

Loading...

Brent Crude

Loading...

Natural Gas

Loading...

Gasoline

Loading...

Heating Oil

Loading...

Rotate device for more commodity prices

The Philippines Just Shut Down Half Of Its Mining Industry

Philippines melter

One of the most-watched happenings in the global mining sector came to a head yesterday. As the government of major mining center the Philippines unveiled results of a nation-wide environmental audit.

And as anticipated, the fallout is significant.

Philippines mining minister Regina Lopez said at a press conference she is ordering the complete closure of 21 mines — representing more than half of the 41 operations scrutinized under the audit.

The majority of operations to be closed are nickel mines. With Minister Lopez saying that about 50% of the Philippines’ overall nickel output will be halted by the closures.

Data released this week from the U.S. Geological Survey peg overall Philippines nickel production for 2016 at 530,000 tonnes — or 21% of total global output. Meaning that the upcoming mine closures could choke off over 10% of worldwide nickel supply.

The effects on the nickel market will be somewhat muted by the recent re-start of nickel concentrate exports from leading producer Indonesia. But the loss of such a big chunk of supply should lend support to prices — with nickel gaining nearly 3% in trading immediately following the announcement of the mine closures.

But it’s not just nickel that’s being affected by the audit. With Minister Lopez also announcing a suspension of the Philippines’ largest gold mine, the Dipidio operation run by international producer OceanaGold. Related: Is Deepwater Drilling About To Make A Comeback?

The audit cited Dipidio for reducing agricultural production in the area surrounding the mine. But left the door open for a restart of operations here if that issue can be remedied.

For its part, OceanaGold told the press it has not received formal notice of the suspension. With management saying they would likely challenge any such orders in court.

The Chamber of Mines of the Philippines also said it will take legal action against the closures and suspensions. Watch to see if mines are allowed to stay operating as these court cases proceed, and for effects on nickel supply and prices if the shutdowns are implemented immediately.

Here’s to the shoe dropping.

By Dave Forest 

More Top Reads From Oilprice.com:




Back to homepage


Leave a comment
  • Anon on February 03 2017 said:
    Shipping nickel ore is dangerous. Ships have been lost due to 'nickel ore liquefaction'-search for it. Pelletized concentrate doesn't do that.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News