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Apex Mining v. Southeast Mindanao Gold Mining Corp.

Facts:
Diwalwal Gold Rush Area is a part of Forest Reserve by virtue of
Proclamation issued by Governor General Davis in 1931. Camilo Banad and his
group claimed that they are the first to discover traces of gold in the area and filed
a Declaration of Location with the Mines and Geo-sciences Bureau. They formed
an organization called Balite Communal Portal Mining Cooperative.
Correspondingly, Apex Mining Corporation entered into operating agreements with
Banad and his group. Marcopper Mining Corporation, on the other hand, filed 16
mining claims or DOLS adjacent to the area covered by the DOL of Banad and his
group, but has abandoned the claim after realizing that the area was covered under
a forest reserve, and instead filed a prospecting permit with the Bureau of Forest
Reserve which was approved by the agency, thus issuing Exploration Permit 133.
The permit however transverses to the permit issued to Apex and other mining
claimants. Conflicts arose and the case was decided by the Supreme Court and was
held that the acquisition of mining permit should be through Bureau of Forest
Reserves since the area is a forest reserve.
Secretary Factoran of DENR issued Department Order No. 66 declaring 729
hectares of forest reserve open to mining and portions of which is covered under
the permit issued to Marcopper Mining Corporation. Exploration Permit 133was
declared void by the Mines and Geo-sciences Bureau.
By appeal to the DENR, the decision was reversed. Marcopper Mining
Corporation later assigned Exploration Permit 133 to Southeast Mindanao Gold
Mining, who applied for a Mineral Production Sharing Agreement which was
approved. Opposition was filed to the Panel of Adjudicators which maintained that
the Exploration Permit 133 is valid.
On appeal, Marcopper Mining Corporation contends that Proclamation No.
279 issued by President Arroyo declaring Diwalwal Gold Rush as a mineral
reservation is invalid for its lack of concurrence from the Congress and it is
contrary to laws.
Mining Adjudication Board decided that Marcopper Mining Corporation is no
longer a party in the action and declared the 729 hectares covered through DAO 66
as non-forest land because EP 133 is expired due to non-renewal. And dismissed
the issue on the unconstitutionality of Proclamation 279 because it should have
been raised in the earliest possible opportunity they had before it was too late.
Raised to the Court of Appeals, it affirmed in toto the Mining Adjudication
Boards decision adding that Southeast Mindanao Gold Mining is an agent of .
Marcopper Mining Corporation and Exploration Permit 133 was validly
transferred, thus giving Southeast Mindanao Gold Mining property rights.

Issue:
Whether or not Southeast Mindanao Gold Mining has acquired vested right
as a result of the assignment of EP 133 by MMC.
Held:
The right that Southeast Mindanao Gold Mining acquired is a limited right
of exploration and did not acquire the rights which are inherent in the permit, since
the assignment was done in violation of the conditions stipulated in the permit. The
necessary approval of the DENR Secretary was not sought and that the permit has
already expired. An exploration permit does not automatically ripen into the right
to extract and utilize the minerals; much less develop a vested right.
The permit is nothing more than a mere right accorded to its holder to be
given priority in the governments consideration in the granting of the right to
develop minerals over the area. The permit may be revoked anytime by the
government.