Mining corporations in Benguet: a brief history
Between the two World Wars, America colonial government staked its interest in the mineral deposits of Benguet, building the necessary roads and infrastructure over rocky mountain terrain to connect mineral-rich areas with the lowlands. American prospectors and investors fueled mining activity, eventually founding the first corporate mining firm, Benguet Consolidated Mining Company (forerunner of today’s diversified Benguet Corporation) in 1903 to exploit the gold deposits of Antamok, Itogon. In 1905, an American geologist recommended to the American Commission the pursuit of mining ventures in Suyoc and Lepanto in Mankayan. Around that time, mining prospectors attached to the American Colorado Volunteer Army arrived in Mankayan and, in 1936, Victor Lednicky of a firm called American Corporates established Lepanto Consolidated [Wilson quoted in Addan 83]. Several prospectors married into local families, which lent an aspect of legitimacy on claims on indigenous land.
Benguet Corporation remained an all-American firm for more than half a century, a vestige of bastion of colonial economic power when the expiration of the "parity rights" trade provision made it legal for government to require at least 60% Filipino ownership of all enterprises. Benguet Corporation stock changed hands under Martial Law from Americans to the brother of former First Lady Imelda Marcos, who gained majority ownership through two real estate companies acting as fronts [Manapat 394]. Today, a nephew of Mrs. Marcos heads the board. Its assets were valued at over P2 billion in 1996.
Lepanto Consolidated Mining Corporation (1996 assets: P1.163 billion) also started in 1936 by American soldiers-turned-prospectors and begun its full-scale postwar activity in 1947. Several prospectors married into local families, making it easier for them to stake their mining claims. Much later, in the Martial Law era, Marcos associate Carlos Palanca Jr. became president and chairman until his death in 1988. After Marcos was ousted, his self-confessed crony Jose Yao Campos surrendered all properties he held in trust for Marcos, among them, 3.3 million shares in Lepanto ["List"].
By their ownership structure alone, these Benguet-based dominant mining companies have been criticized as structures benefiting elite foreign and Filipino interests, represented either by individual investors or creditor institutions. Benguet Corporation is listed in the New York Stock Exchange, similar to Philex Mining Corporation based in Tuba municipality.
An official of the Philippine Chamber of Mines proudly notes that the mining industry contributed to total export earnings "from a high of 24% in the mid-1970s to a low of 6% in the early 1990s" [Contreras 26]. In the first half of the 1990s up to the present, Lepanto and Benguet Corporation have scaled down operations. Lepanto has not paid income taxes from 1995 to 1997 as a result of its operating losses. Meanwhile, the official estimates of Philippine mineral reserves have steadily grown.
As a result of the Code, there are 84 pending FTAA applications by Canadian and Australian companies lodged in the MGB [Malanes], none of which have yet been approved, which aim to exploit some 5.9 million hectares, or roughly 40 percent of the Philippine land area [Conde]. An FTAA grants a foreign-owned firm a 25-year mining extraction permit, renewable for another 25 years. To date, no FTAA has been approved due to controversies in prospective mining areas [Dizon]. This has not stopped the Ramos or Estrada governments from inviting more mining firms to start operations.
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