The Didipio Mine is governed by the terms of a Financial or Technical Assistance Agreement (FTAA) with the Philippine Government and is operated in accordance with all applicable Philippine laws, rules, regulations and requirements. In addition, OceanaGold’s operations are conducted in accordance with the company’s corporate policies.
Our FTAA became renewable for another 25 years under the same terms and conditions in June 2019. We lodged our notice for renewal of the FTAA with the Philippine Government in March 2018 and received confirmation on 20 June 2019 from the regulatory authority, the Mines and Geosciences Bureau (MGB), that the Didipio Mine is permitted to continue operations pending the confirmation of the FTAA renewal
The FTAA gives OceanaGold the right and responsibility to explore, develop and operate in the Didipio area, but does not award the company ownership of any mineral resources.
Under the terms of the FTAA, Didipio’s net revenue (as defined in the FTAA) is shared with the Philippine Government. The Government’s share, which includes all taxes and royalties paid, is 60% and OceanaGold is entitled to 40%. The FTAA includes a defined five-year recovery period during which time OceanaGold is allowed to recoup the capital investment made to develop and construct the mine. During the recovery period and on an ongoing basis, OceanaGold pays taxes, royalties and other fees.
In addition to the Government’s share, OceanaGold invests in the Philippines, directly and indirectly supporting jobs and economic activity. For example, since commencing operations in 2013 the Didipio Mine has spent approximately PHP 39.5 billion (US$790 million), which includes development expenditure for its host and neighbouring communities, community investment projects, payments to national or local suppliers and contractors, government taxes and employee wages. Of this expenditure, 96 per cent (PHP 38.3 billion) was paid to employees, government and businesses through salaries, taxes and procurement while PHP 1.2 billion was spent for community development.
Additional data about our payments and contributions is available in the 2018 Sustainability Report.