Reuters reported that officials of a southern Philippine city are questioning the legality of a local law prohibiting open pit mining in their province, providing support to a battle waged by the local unit of Canada's TVI Pacific Inc against the ban.
The legislative council of Dipolog City in Zamboanga del Norte province on the southern Mindanao island passed a resolution last week giving the city mayor powers to undertake appropriate legal action questioning the validity of the ban.

A company spokesman said that the resolution came just days after TVI Resource Development Inc filed a petition with the local court seeking to stop the provincial government from implementing the open pit mining ban. TVI's USD 60 million copper and zinc mine in Zamboanga del Norte continues to operate normally and remains fully supported by the local community despite the ban.

TVI Resource has estimated foregone revenues of USD 500 million if it would be forced to close the mine by November 2012. It added it could extend the project's life by 4 to 5 years from next year. The city council's resolution says certain provisions of the ordinance are beyond the powers of provincial officials to enact and could adversely affect the city's sand and gravel businesses.

Dipolog officials also questioned the provision authorizing the provincial governor to issue an order stopping or suspending any mining operations or utilization of natural resources, saying the provision usurps the power of the government body issuing permits for such activities.

A similar ban in South Cotabato, also in southern Philippines has put at risk the USD 5.9 billion Tampakan copper and gold project of global miner Xstrata Plc and Indophil Resources NL. Manila is crafting a new mining policy to address thorny issues hampering the industry, including how to overrule provincial bans.

(Sourced from Reuters0