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Visualizing a Future with Formalized Artisanal and Small Scale Gold Mining

The Historic Gold Town of Paracale

By planetGOLD

November 29^th, 2021

Paracale, a municipality in the province of Camarines Norte, Philippines, is a place where gold is in such abundance that the town's name itself reflects its history in mining. Paracale was derived from para cale, meaning "canal digger".

Local art showing the importance of gold mining to the community in Paracale (Photo by Dr. Kevin Telmer)

Visualizing a Future with Formalized Artisanal and Small Scale Gold Mining

"For as long as I can remember, artisanal gold mining has been a part of our town's history- if you grew up here, I wouldn't be surprised if you've most likely been involved in various parts of the gold trade in one way or another,"

-Mr. Serafin Dasco, President of the Federation of Miners Association, a small-scale mining association advocating for miners’ rights and welfare while working towards ensuring that the operations of its members comply with government formalization requirements. This means that the miners operate as formal businesses that meet the standards of conduct required by the regulators.

At present, mining activities are scattered throughout the 27 barangays of the municipality of Paracale, with the majority of the population involved in artisanal and small-scale gold mining activities (ASGM). In Camarines Norte, ASGM provides livelihood opportunities for approximately 11,000 families. In Paracale, it is estimated that over half of the total population are engaged in Small Scale Mining (SSM), either as a mine worker, financier, processor, independent gold panner, or in the many support services business. Many residents choose to work in different aspects of ASGM to gain financial independence and acquire new wealth.

Paracale’s proud heritage in artisanal gold mining and craftsmanship

Paracale's residents recognize and celebrate the town's identity as a "gold town" and embrace it as a source of pride. The town emblem of Paracale features a miner's hat, pickaxe, and shovel, symbolizing the importance of gold mining, alongside a symbol of a fish and a boat, symbolizing the town’s popularity as a fishing spot and tourist destination for its sandy beaches.

The municipal building of Paracale features a mini-museum proudly displaying ornate and unique jewelry pieces made from locally sourced gold, highlighting the craftsmanship of local artisans. Every last week of January until the second day of February, the province also hosts a colourful festival celebrating the importance of gold mining in the town called "Pabirik Festival", named after the process of gold panning called pagbibirik in Filipino, which features ASGM-themed parade floats.

A town officer shows the winning jewelry design during the 22nd Pabirik festival by artist Glenn Valeros (Photo: Lyka Cabatay)

The town emblem of Paracale (Photo: Lyka Cabatay)

Recovering Gold from Ore

In Paracale, miners commonly practice underground mining, wherein tunnels called drifts (horizontal) and shafts (vertical) are dug. Timber is used to reinforce the walls of the shafts and drifts. A mechanized pulley system is used to haul mined ore and waste rock and the miners themselves to descend and ascend the shafts. In addition, a PVC pipe is installed, acting as a communication tool between the miners below and those tasked to monitor the surface.

Small-scale miners in Paracale (Credit: Lyka Cabatay)

Crushed ore for mining site in sack bags (Credit: Lyka Cabatay)

Another example of a tunnel found in Paracale (Photo by Dr. Kevin Telmer)

How gold is recovered depends on how it is found in nature. For instance, coarse free gold particles are liberated through grinding using ball mills and are separated by gravity methods such as sluicing and panning. The toxic heavy metal mercury is used to recover free gold via a process called amalgamation. Fine free gold particles and gold particles that are locked or inside of other minerals such as sulphides can not be extracted with mercury but can be recovered by cyanidation. Mercury contaminates the soil, water, air, and the equipment used in the amalgamation process. Exposure to mercury causes adverse health effects to miners and their communities and poses significant risks to unborn fetuses and children. Most miners in Paracale operate without proper personal protective equipment (PPE) and occupational health and safety protocols to address these risks. The planetGOLD Philippines project aims to introduce improved occupational health safety standards at target project sites through awareness-raising and capacity-building activities.

Mercury contamination is a significant public health and environmental problem. Once emitted to the air, mercury can travel hundreds of kilometers through atmospheric circulation before being deposited on the earth's surface and contaminate water bodies, flora and fauna. Despite this, mercury is still used in ASGM in Paracale and many other ASGM communities around the world because it is quick and easy to use, does not require sophisticated equipment, and is also generally cheaper and easily accessible compared to other gold recovery technologies. However, there is a trade off as not only mercury impacts health and environment but also recover less gold, reducing miner’s income.

Facilitating formalization of ASGM in Paracale

To date, some artisanal gold miners in Paracale operate informally- these miners are not recognized or represented by a legal entity. They are not registered, therefore can not receive government support, or do not abide by or benefit from the mining regulations in the Philippines.

Principal laws that govern small-scale mining in the Philippines are Presidential Decree 1899 and the Republic Act 7076, also known as the People's Small-Scale Mining Act of 1991. The latter focuses on regulating the small-scale mining industry to enhance its growth and productivity while ensuring environmental protection. The law aspires to provide miners with technical, financial, and marketing assistance while guaranteeing efficient collection of government revenues and promoting good governance and integrity in the industry. In short, it aspires to professionalize informal mining.

"Responsible mining is not just a responsibility of large-scale mining companies. It should also apply to small-scale mining." - Guillermo Molina Jr., Regional Director, MGB Region V

Under this Administrative Order, no small-scale mining activity shall be undertaken outside of a declared People's Small-Scale Mining Area (locally known as Minahang Bayan), and no entity should engage in small-scale mining without a Small-Scale Mining Contract (SSMC), a document which outlines the co-production, joint venture or mineral production sharing agreement between the government and small-scale mining contractor for the utilization of the plot of mineral land inside a Minahang Bayan.

Having designated Minahang Bayan areas allows the Department of Environment and Natural Resources (DENR) to regulate the small-scale mining industry, paving the way towards legal, cleaner, and more efficient small-scale gold mining practices that benefit the miners and the environment. With the aim of formalizing more artisanal miners, the DENR has set out to fast-track the processing of Minahang Bayan applications, recognizing their importance in generating jobs and fueling economic growth, especially in the countryside. With the Mining and Geosciences Bureau (MGB) urging cooperation from local government units to expedite approvals of Minahang Bayan applications in the past two years, the future of small-scale mining in Paracale is moving in the right direction. As of June 2019, six proposals for Minahang Bayan areas have been filed for Paracale. As of August 2019, 26.4913 hectares of land in Barangay Casalugan has been declared as an official Minahang Bayan site by the Provincial Mining Regulatory Board, through Resolution No. 09-2019.

Creating Incentives to Produce "Clean Gold"

ASGM's positive contribution to the Philippine economy has been getting more recognition by the Bangko Sentral ng Pilipinas (BSP) especially during an unexpected crisis like the COVID-19 pandemic. Early in 2020, the BSP has announced that they "would shift to active gold trading amid rising prices prices of gold, which is considered a safe-haven asset during crisis". Following this, the central bank of the Philippines has enacted operational improvements to encourage small-scale miners to sell their gold to legal and authorized Gold Buying Stations (GBS) of the BSP so that they can get a fair and competitive price for their gold while contributing to the gold reserves of the country. The BSP reports that they are making rates more attractive for miners, and are working towards fast-tracking operations for payment. They have worked on increasing advanced payments to 99% to gold sellers and reducing the retention fee to only 1% during the gold assay process. Registered small-scale miners who sell their gold to BSP-GBS are also tax exempted from income and withholding taxes, as well as an excise tax following Bureau of Internal Revenue (BIR) Regulation Number 4-2022 passed February 2020.

Through these operational improvements, the BSP's Mint and Refinery Operations Department predicts an increase in gold purchase in the future, contributing to the country's currency exchange buffer while supporting ASGM miners towards their transition to the formal economy and encouraging private sector investment in the ASGM sector, which further translates to more jobs in the countryside.

Improving ASGM practices through the planetGOLD Philippines project

The ASGM sector is the world's largest source of anthropogenic mercury pollution, accounting for one-third of the annual mercury emissions. Globally, ASGM provides employment for 10-20 million miners in over 80 countries, producing roughly 20% of the world's gold. In the Philippines, mercury is extensively used in ASGM in more than 20 provinces across the country.

The planetGOLD programme (Global Opportunities for the Long-term Development of the ASGM sector) funded by the Global Environment Facility (GEF) is designed to improve the production practices and work environment of artisanal gold miners while addressing key issues linked to continued mercury use in the sector. The planetGOLD Philippines is one of eight country projects under the programme working towards creating a formalized ASGM sector that enhances community development, improves productivity and eliminates the use of mercury. The planetGOLD Philippines is implemented by the United Nations Environment Programme (UNEP), UN Industrial Development Organization (UNIDO), DENR and is executed by the Artisanal Gold Council in partnership with the MGB. Paracale has been identified as one of the target project sites by planetGOLD Philippines.

Footnotes

Videos, Photos and Text taken and composed by Lyka Cabatay - planetGOLD Philippines / Artisanal Gold Council (AGC). Edited by Rizza Sacra-Dejucos, National Communications Officer, planetGOLD Philippines / AGC, Dr. Anupama Ariyaratne, Communications and Science Officer, AGC and Dr. Kevin Telmer, Executive Director, AGC

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FootNotes

GOLD WITHOUT MERCURY

In southern Peru, women and men in artisanal and small-scale gold mining (ASGM) are promoting mercury-free, responsible, and inclusive mining.

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June 24^th, 2022

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Visualizing a Future with Formalized Artisanal and Small Scale Gold Mining

The Historic Gold Town of Paracale

FootNotes

Intergenerational actions for responsible artisanal mining in the north of Peru

Acciones intergeneracionales para una minería artesanal responsable en el norte del Perú

En el sur del Perú, las mujeres y hombres de la MAPE están impulsando una minería sin mercurio, responsable e inclusiva.

In southern Peru, women and men in artisanal and small-scale gold mining (ASGM) are promoting mercury-free, responsible, and inclusive mining.

Members of the planetGOLD global team reflect on equitable opportunities for women

June 24^th, 2022

FootNotes

Intergenerational actions for responsible artisanal mining in the north of Peru

Acciones intergeneracionales para una minería artesanal responsable en el norte del Perú

En el sur del Perú, las mujeres y hombres de la MAPE están impulsando una minería sin mercurio, responsable e inclusiva.

In southern Peru, women and men in artisanal and small-scale gold mining (ASGM) are promoting mercury-free, responsible, and inclusive mining.

Members of the planetGOLD global team reflect on equitable opportunities for women

June 24th, 2022

June 24^th, 2022