By Atty. Patricia A O Bunye and Atty. Rafael Raymundo A Evangelista | Lexology | May 15, 2025

Mining rights and title

State control over mining rights
To what extent does the state control mining rights in your jurisdiction? Can those rights be granted to private parties and to what extent will they have title to minerals in the ground? Are there large areas where the mining rights are held privately or which belong to the owner of the surface rights? Is there a separate legal regime or process for third parties to obtain mining rights in those areas?

Under the Philippine Constitution, the state owns all natural resources, including minerals. The exploration, development and utilisation of mineral resources are under the full control and supervision of the state, which may directly undertake the same or enter into co-production, joint venture or production-sharing agreements with Filipino citizens, or corporations or associations with at least 60 per cent of whose capital is owned by such citizens. The Philippine President may also enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration, development and utilisation of minerals, petroleum and other mineral oils. Because of the state’s full control and supervision over mining rights, owners of surface rights do not automatically have rights over mineral resources found within their properties.

Because certain critical minerals are essential in developing renewable energy, it is relevant to the mining industry that in 2022, the Department of Justice (DOJ) issued DOJ Opinion No. 21, series of 2022, clarifying that the exploration, development and utilisation of solar, wind, hydro, and ocean or tidal energy is not subject to the 40 per cent foreign equity limitation under the Philippine Constitution.

Publicly available information and data
What information and data are publicly available to private parties that wish to engage in exploration and other mining activities? Is there an agency, or securities commission regulating public companies, which collects mineral assessment reports from private parties? Must private parties file mineral assessment reports? Does the agency or the government conduct geoscience surveys, which become part of the database? Is the database available online?

The Philippine Mines and Geosciences Bureau (MGB) regularly publishes information on the mining industry through its official website (www.mgb.gov.ph), including details on existing exploration permits (EPs), mineral production sharing agreements, financial and technical assistance agreements (FTAAs), mineral processing permits, pending mining applications and pending cases with the Mines Adjudication Board and Panel of Arbitrators, current and historical statistics on the mining industry, such as the production level and prices of each type of mineral, and a list of currently producing mines and a map showing where these operate.

The MGB also conducts geoscience surveys such as geological mapping, mineral exploration, geo-hazard assessment, vulnerability assessment and other geological and geo-environmental studies. These surveys are not readily available online.

Acquisition of rights by private parties
What mining rights may private parties acquire? How are these acquired? What obligations does the rights holder have? If exploration or reconnaissance licences are granted, does such tenure give the holder an automatic or preferential right to acquire a mining licence or more senior tenure? What are the requirements to convert to a mining licence?

Private parties acquire mining rights through an EP, a mineral agreement (MA) or an FTAA.

An EP grants exclusive rights to explore specified areas, while an MA grants exclusive rights to conduct mining operations and to extract all mineral resources found in the contract area. An FTAA grants the right to provide financial or technical assistance directly to the government to undertake large-scale exploration, development and utilisation of minerals.

Under the implementing rules and regulations of the Philippine Mining Act, the permittee of an EP may apply for an MA or FTAA over the permit area upon meeting the necessary qualifications and terms and conditions. However, the exploration period covered by the EP shall be included as part of the exploration period of the MA or FTAA.

Renewal and transfer of mineral licences
What is the regime for the renewal and transfer of mineral licences?

The term of an EP is two years from the date of issuance by the Department of Environment and Natural Resources (DENR), through the Mines and Geosciences Bureau (MGB). It may be renewed for another two years, but the total term of the permit shall not exceed eight years for metallic mineral exploration. In certain cases, the EP may be further renewed by the DENR Secretary for another term of two years. EPs are automatically renewed without the need for filing applications for renewal. However, permit holders must submit the requirements enumerated under DENR Administrative Order No. 2021-12 (DAO 2021-12) to the MGB, including the payment of a renewal fee. In the case of failure to file the declaration of mining project feasibility (DMPF) during the eight-year period, the permittee may apply for further renewal of the EP, subject to the approval of the DENR Secretary. If the permit expires before the DMPF is approved and the MA or FTAA is filed, it is automatically extended until the MA or FTAA application is approved. In the event of a failure to file the application or to secure the approval of the DMPF within the prescribed period, the EP is relinquished and shall be immediately opened to new mining applications.

The term of an MA shall not exceed 25 years. It is renewable for another 25 years under the same terms and conditions, without prejudice to changes mutually agreed upon by the government and the contractor.

The term of an FTAA shall not exceed 25 years. It is renewable for another term not exceeding 25 years under such terms and conditions as may be provided by law and mutually agreed upon by the parties.

The exploration periods of MAs and FTAAs are also automatically renewed without the need for an application and subject only to the submission of the requirements under DAO 2021-12 and to the payment of the renewal fee.

EPs may be transferred or assigned subject to the approval of the MGB Director. MAs may be transferred subject to the approval of the DENR Secretary upon the recommendation of the MGB Director. FTAAs may be transferred subject to the approval of the President, as recommended by the MGB Director and endorsed by the DENR Secretary.

Duration of mining rights
What is the typical duration of mining rights? Is there a requirement to relinquish a portion of the mining rights to the government after a certain number of years?

Mining rights involve EPs, MAs, FTAAs, quarry, sand and gravel, guano, gemstone gathering permits and small-scale mining permits.

The term of an EP shall be two years from the date of issuance, renewable for another two years, but not to exceed eight years for metallic exploration. The holder of an EP must annually relinquish at least 20 per cent of the permit area during the first two years of exploration and at least 10 per cent of the remaining permit area annually during the extended exploration period. However, if the permit area is less than 5,000 hectares, the holder of an EP need not relinquish any part thereof.

The term of a MA shall not exceed 25 years from the date of its execution. It is renewable for another term not exceeding 25 years. After the exploration period and prior to or upon approval of the DMPF, the contractor must relinquish any portion of the contract area that is not necessary for mining operations and is not covered by any DMPF. Each mining area, after final relinquishment, shall not be more than 5,000 hectares for metallic minerals.

The term of a FTAA shall not exceed 25 years from the date of its execution. It is renewable for another term not exceeding 25 years. The contractor must relinquish at least 25 per cent of the original contract area during the first two years of the exploration period and at least 10 per cent of the remaining contract area annually during the extended exploration period and pre-feasibility study period. During the exploration or pre-feasibility study period, the contractor shall finally relinquish any portion of the contract area that is not necessary for mining operations, and is not covered by any declaration of mining feasibility, provided that each mining area after final relinquishment shall not be more than 5,000 hectares.

The grounds for the cancellation, revocation and termination of an EP, MA or FTAA are:

• falsehood or omission of facts in the application that may alter, change or affect substantially the facts set forth in said statements;
• non-payment of taxes and fees for two consecutive years;
• failure to perform all other obligations, including abandonment, under the permits or agreements;
• violation of any of the terms and conditions of the permits or agreements; and
• violation of existing laws, policies, rules and regulations.

Acquisition by domestic parties versus acquisition by foreign parties
Is there any distinction in law or practice between the mining rights that may be acquired by domestic parties and those that may be acquired by foreign parties?

Yes. Under the Philippine Constitution, only Filipino citizens or corporations whose capital is at least 60 per cent owned by Filipino citizens may enter into MAs. Non-Filipino nationals or corporations that are 100 per cent foreign-owned may secure EPs and enter into FTAAs only.

Protection of mining rights
How are mining rights protected? Are foreign arbitration awards in respect of domestic mining disputes freely enforceable in your jurisdiction?

The Philippine Mining Act created the Panel of Arbitrators, which has exclusive and original jurisdiction to hear and decide mining disputes involving:

• rights to mining areas;
• MAs, FTAAs or permits; and
• surface owners, occupants and claim holders or concessionaires.

The jurisdiction of the panel is limited to mining disputes that raise questions of fact or matters requiring the application of technical knowledge and experience. Otherwise, disputes fall within the jurisdiction of regular courts.

Foreign arbitral awards in respect of domestic mining disputes are recognised and enforceable in this jurisdiction. When confirmed by the Regional Trial Court, they are enforced as a foreign arbitral award and in the same manner as final and executory decisions of Philippine courts of law.

Surface rights
What types of surface rights may mining rights holders request and acquire? How are these rights acquired? Can surface rights holders oppose these requests or does the holder of the mineral tenure have priority over surface rights use?

Permit holders and contractors, upon written notice and payment of just compensation, may enter, occupy and explore the stipulated mining areas or land where they are so situated that, for purposes of more convenient operations, it is necessary to build, construct or install infrastructure on the mining areas or land owned, occupied, or leased by other persons.

Further, holders of mining rights cannot be prevented from entering their contract areas for purposes of exploration, development, and utilisation, provided that written notices are sent to the surface owners, occupants and concessionaires and that a bond is posted by the holder of the mining rights. Should surface rights holders refuse to allow permit holders entry into the mining area, the matter shall be referred to the Panel of Arbitrators.

Participation of government and state agencies
Does the government or do state agencies have the right to participate in mining projects? Is there a local listing requirement for the project company?

Yes, the Philippine Constitution allows the government and state agencies to participate in mining projects, either by directly undertaking exploration, development and utilisation of minerals or through co-production, joint venture or production-sharing agreements with Filipino citizens or corporations or associations at least 60 per cent of whose capital is owned by Filipino citizens. The state may also enter into FTAAs with foreign-owned corporations for large-scale exploration, development and utilisation.

Neither the Philippine Constitution nor the Philippine Mining Act requires mining project companies to be publicly listed.

Government expropriation of licences
Are there provisions in law dealing with government expropriation of licences? What are the compensation provisions?

The Philippine Mining Act provides that contractors’ properties are generally free from expropriation. However, the government may expropriate such property for public use or in the interest of national welfare or defence after payment of just compensation.

Protected areas
Are any areas designated as protected areas within your jurisdiction and which are off-limits to mineral exploration or mining, or specially regulated?

The implementing rules and regulations of the Philippine Mining Act enumerate the areas closed to mining applications:

1. areas covered by valid mining rights and applications subject to point (3);
2. old-growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, mossy forests, national parks, provincial and municipal forests, tree parks, greenbelts, game refuges, bird sanctuaries, marine reserves and parks and tourist zones;
3. areas that the DENR Secretary may exclude, namely:

• offshore areas within 500 metres of the mean low-tide level areas and onshore areas within 200 metres of the mean low-tide level along the coast; and
• other areas expressly prohibited by law.

Executive Order No. 79, series of 2012, expanded the list of protected areas to include:

• prime agricultural lands, lands covered by agrarian reform, strategic agriculture, fisheries development zones, fish refuges and sanctuaries;
• tourism development areas; and
• other critical areas, island ecosystems and impact areas of mining.

EPs, MAs or FTAAs cannot be granted in areas subject to certificates of ancestral domain or ancestral land claims, except with the prior consent of the relevant indigenous cultural communities.

Source: Lexology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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