SC favors PGMC on Palawan nickel claims


Posted at Nov 10 2009 11:25 AM | Updated as of Nov 11 2009 04:04 AM

MANILA - The Supreme Court (SC) has denied motions for reconsideration filed by the operating unit of the Oriental Peninsula Resources Group and upheld its earlier decision favoring Platinum Group Metals Corp. (PGMC) in all 4 cases arising from the firms' fight for control over nickel mines in Palawan.

In a 23-page decision written by Justice Arturo Brion, the High Court's special second division also denied motions filed by Oriental Peninsula's subsidiary, Citinickel Mines and Development Corp., to refer the earlier decision to the SC en banc.

PGMC's legal counsel said the cases focused mainly on whether it was the Palawan Regional Trial Court (RTC) or the Department of Environment and Natural Resources' Panel of Arbitrators (POA) that had jurisdiction over the mining claim dispute.

The Palawan RTC had ruled in favor of PGMC, which said that Citinickel and its mining claim owner, Olympic Mines and Development Corp., violated PGMC's operating agreement with Olympic. This was after Olympic allegedly voided its agreement with PGMC and secretly signed a similar deal with Citinickel.

The POA, on the other hand, favored Citinickel and Olympic after claiming jurisdiction on the belief that the issue was a mining dispute instead of a simple civil case.

The SC then upheld the decision of the Palawan RTC. It said that the trial court, not any administrative agency, has the sole authority to resolve the issue. As a result, the 3 other cases stemming from the dispute were also ruled in favor of PGMC.

No more business

Should the High Court deny Citinickel's second motion for reconsideration, PGMC's counsel said the Palawan RTC will resume hearing to resolve 2 things: on who has the right to mine the property, and if PGMC is entitled to P50 million in damages.

"There is no need to ask the DENR to recognize the validity of the operating agreement since the court has already nullified the ruling of POA canceling the PGMC's operating agreement with Olympic--meaning the agreement is valid and subsisting," PGMC's counsel said.

Once the SC declares with finality its decision in favor of PGMC, the company will then ask the government to recognize its operating agreement so it can resume operations within 4 to 6 months.

At present, Oriental Peninsula has control over the Palawan nickel mines. In other words, if the High Court rules in favor of PGMC with finality, Oriental Peninsula will no longer have any business to pursue.

Oriental Peninsula earlier told the local bourse that it has fully used up the P804 million it raised from its initial public offering for mine site and camp development, land acquisition, and the construction of roads, bridges, and dams.

PGMC, however, claimed that Oriental Peninsula had never gained access to the nickel site while cases on the mining claim dispute were pending in the courts.