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Small-Scale Gold Mining and the Mercury Problem

As of 2026-08-30 · Updated 2026-08-30 · Section: Mineral Resources · 日本語版

Most of the Philippines' gold is dug in places that never show up in the statistics. Small-scale gold mining (ASGM: Artisanal and Small-Scale Gold Mining) is said to involve some 500,000 workers, yet only a small fraction of mining areas are formally registered, and most of the gold produced flows not to the central bank but into the informal market. Mercury amalgamation is still in active use today. The Philippines ratified the Minamata Convention in 2020, and mercury use is fully banned under domestic law, yet seizures of smuggled mercury continue even into 2026. The 2025–2026 surge in gold prices (US$4,400–4,600 per troy ounce as of August 2026) is further accelerating this dynamic.


1. 注 First, distinguish what kind of number you're looking at

This field has the awkward property that "wildly different orders of magnitude can both be correct for the same country at the same time." Before reading further, keep the following distinctions in mind.

Concept to distinguish Meaning Representative Philippine figure
Reserves The amount confirmed to be economically minable. Depends on the standard applied PSA's "Class A reserves" for gold: 371,260 kg (2025, Philippine Statistics Authority PSA Mineral Accounts)
Resources Shown to exist but economic viability is not yet established. Always larger than reserves Disclosed mine-by-mine under JORC/NI 43-101 (below)
Endowment/potential A geological "there's probably gold here" estimate, outside any reporting standard MGB's "roughly 9 million ha of high mineralization potential area," etc.
Central bank gold reserves Bullion in the vault, not gold in the ground 133.51 tonnes (Q1 2026, BSP, via Trading Economics)
Annual production The amount actually mined 2024: 28,870 kg (MGB)

注 The English phrase "gold reserves" can refer to either "reserves in the ground" or "bullion held by the central bank." Japanese-language articles that conflate the two are extremely common.

Differences in reporting standards

Standard Nature How it is used in the Philippines
JORC Code (Australia) / NI 43-101 (Canada) Disclosure standards for listed companies, requiring sign-off by a Competent/Qualified Person, with mandatory disclosure of the gold-price assumption and cut-off grade Used by OceanaGold's Didipio Mine and B2Gold's Masbate Gold Project
Philippine Mineral Reporting Code (PMRC 2020) The Philippine equivalent of the above, used for PSE (Philippine Stock Exchange) disclosures OceanaGold Philippines disclosed a revised PMRC 2020-based mine plan to the PSE in March 2026 (extending mine life to 2037, assuming a gold price of US$2,200/oz)
UNFC-2009 → PSA's Mineral Accounts A UN classification. Class A = commercially recoverable, B = potential, C = non-commercial. Only Class A is given a monetary valuation PSA's "Mineral Accounts of the Philippines" (based on SEEA-CF 2012, using a 10.0% discount rate)
Government estimates / industry claims Outside any reporting standard; figures that cannot be reproduced Claims such as "US$1.8 billion worth of gold buried in Diwalwal"

注 The claim that "the Philippines is the world's 2nd-largest gold reserve holder" is not substantiated. Rappler's fact-check finds that, measured by central bank gold holdings, the Philippines ranks around 26th in the world (157.06 tonnes as of Q4 2022, versus the United States' 8,133.46 tonnes / World Gold Council, IMF), and concludes the claim does not hold up. The most likely original source is a qualified statement in the Mines and Geosciences Bureau (MGB)'s own promotional material, claiming Philippines "3rd in the world for gold deposit density per unit area" — it appears the qualifier "per unit area" was dropped along the way, turning the claim into one about absolute rank. This material does not adopt the "world's 2nd-largest" claim.


2. The scale of ASGM — "70%" and "1%" are both correct

Item Figure Year/source
Small-scale gold mining workers approximately 500,000 planetGOLD Philippines (GEF-funded; implemented by UNEP/UNIDO)
People indirectly dependent on it for their livelihood Approx. 2 million Same as above
Provinces with ASGM activity 40+ of 82 provinces Same as above (NCSSMPI/BAN Toxics put it at "30+ provinces"). (Corrected during the 2026-08-25 cross-check review from "of 81 provinces" to "of 82 provinces." The 17 September 2022 division of Maguindanao raised the province count from 81 to 82. Source replaced 2026-08-26: PSA, "Q3 2022 PSGC Update — Including the Split of Maguindanao Province," records that "under RA 11550, ratified by plebiscite held 17 September 2022, Maguindanao province was split into Maguindanao del Norte and Maguindanao del Sur," which raised the nationwide province count from 81 to 82. Also citing the original text of RA 11550 (lawphil.net) and COMELEC's plebiscite-related resolution (Resolution No. 10816, among others, archived at comelec.gov.ph). Where original text still shows 81, that is the pre-split value.)
ASGM's share of domestic gold output 70% (planetGOLD) / approx. 75% (NCSSMPI, 2025–2026) planetGOLD / National Coalition of Small-Scale Miners of the Philippines (NCSSMPI), April 2026
Separate estimate of workers 200,000–300,000 BSP-related reporting
ASGM gold captured in official statistics fell to 1.26% of recorded gold output (₱600 million) in 2019 World Gold Council, "Central Bank Domestic ASGM Purchase Programmes"

The "70%" and "1.26%" are not contradictory. The former is an estimate of the amount actually mined; the latter is the amount officially recorded through the central bank (BSP). In other words, the entire difference disappears into informal circulation.

注 The 500,000 figure is a planetGOLD estimate from around 2019, not a real-time measurement as of 2025–2026. Industry groups, NGOs, and UN agencies have repeated this figure over and over, but no primary national census could be confirmed.

Reference: official statistics from the large-scale mining side (MGB)

Period Gold output Production value Notes
2024 28,870 kg ₱126.36 billion Gold overtook nickel as the top commodity
Jan–Sep 2025 20,500 kg (−5.3%) ₱117.42 billion (+28.9%) Volume down, value up
Q1 2026 5,850 kg (−24.7%) ₱53.78 billion (+31.2%) Gold accounts for 65% of metallic mineral production value

Volume down, value up — this is the basic pattern of the gold sector in 2025–2026. The largest gold producer is the Masbate Gold Project (Filminera Mining/Philippine Gold Processing & Refining), which produced 1,646 kg in Q1 2026.


Underlying law and key administrative orders

Law Year Key points
PD 1899 1984 The former small-scale mining law. The Department of Justice interprets it as effectively superseded by RA 7076
RA 7076 (People's Small-Scale Mining Act) 1991 The foundational small-scale mining law. Created the Minahang Bayan (People's Small-Scale Mining Area) designation system. Ore output capped at 50,000 tonnes per year, contract areas capped at 20 ha. Gold produced must be sold to the BSP
EO 79 2012 A comprehensive review of mining policy. Bans mercury use in mineral processing
DAO 2015-03 (revised IRR of RA 7076) 2015 A full ban on mercury, a ban on compressor mining (underwater diving mining) and hydraulicking. Limits small-scale mining to gold, silver, and chromite as the only permitted metals. Processing restricted to centralized custom mills within a Minahang Bayan
DAO 2022-03 (the current revised IRR) Took effect 29 April 2022 Replaces DAO 2015-03. Streamlined the Minahang Bayan designation process (PMRB application → MGB regional office → MGB central office → DENR Secretary clearance → PMRB declaration following ECC submission)
RA 11256 2019 Exempts registered small-scale miners and accredited traders who sell gold to the BSP from income tax and excise tax (discussed further below)

注 Being designated a Minahang Bayan alone does not authorize mining. As MGB-CAR has explicitly stated, mining can begin only after DENR issues a Small-Scale Mining Contract under Section 11 of RA 7076. "Designation" is not the same as "legalization."

Progress and dysfunction of the designation process

Indicator Figure Year/source
Approved Minahang Bayan applications 53, with 224 pending As of 2022 / Altermidya, Rappler (October 2023 reporting)
Declared Minahang Bayan 63, with 209 pending Separate reporting (timing unspecified, unconfirmed)
Cordillera Administrative Region (CAR) 15 (as of November 2025) MGB-CAR
Davao Region DENR clearance obtained for 5 sites (339 ha total); 9 more at the regional-declaration-only, pending stage MGB, PIA (2025)
Small-scale mining reality in Benguet province Roughly 8,000 sites, roughly 30,000 workers Benguet Provincial Environment Office

This contrast is the crux of the problem. Benguet province alone has some 8,000 operations, while the entire country has only a few dozen formal Minahang Bayan sites. "Small-scale mining = almost entirely unregistered/informal" has become the effective default.

Recent developments in 2025: - 5 November 2025: the Kalinga province PMRB declared 161.25 ha in the Banao Bodong Tribal Association (BBTAI) area of Tanudan town, Kalinga, as a Minahang Bayan (DENR Secretary clearance dated 18 August 2025) — the 15th such site within CAR. - May 2025: the Benguet province PMRB declared 31.25 ha in Camp 4, Tuba town, for the Benguet Federation of Small-Scale Miners.

注 Reviews stall on the political calendar. The resignation of Environment Secretary Maria Antonia Yulo-Loyzaga on 22 May 2025, and the transition to Secretary Raphael Lotilla, is reported to have stalled review of the 9 pending Davao Region applications.

Legislative moves in 2025–2026


4. Major production sites

Diwalwal (Mount Diwata, Monkayo town, Davao de Oro province)

Matter Content
Discovery September 1983: an Indigenous Lumad man, Camilo Banad, discovered gold in a stream on Mount Diwata (some sources say 1982)
Gold rush The population swelled to roughly 125,000 within three years, drawing in army deserters, former rebels, and even firearms smugglers
Name The official designation is Barangay Mount Diwata. "Diwalwal" is Cebuano slang meaning "tongue hanging out from exhaustion." "Diwata" means spirit/goddess
Area The Diwalwal Mineral Reservation Area (DMRA) covers 8,100 ha (Monkayo town plus Boston and Cateel, Davao Oriental province), of which the small-scale mining area is 729 ha (DENR AO 66)
Workers Roughly 30,000, many operating informally
"Remaining reserves" Figures such as 注"US$1.8 billion worth" or "2.7 million ounces of high-grade ore" are repeatedly cited, but these are local-government/press-based estimates that do not follow reporting standards such as JORC/NI 43-101, and cannot be classified as either reserves or resources

Contamination: ore is crushed in ball mills, amalgamated with mercury, then heated with an open-air blowtorch. The Naboc River (a tributary of the Agusan River) has been severely contaminated with mercury and cyanide. A UK-led survey (Appleton et al., 2006, Science of the Total Environment) found mud in the Naboc River exceeding 90 mg-Hg/kg, and an average of 24 mg-Hg/kg in irrigated paddy soils — both exceeding UK/Canadian agricultural-land standards, the Dutch intervention value, and USEPA screening values. Corn and banana fields that had not been irrigated measured a normal 0.05–0.99 mg/kg. Roughly 600 farming households in the downstream Naboc communal irrigation area were affected.

Government action: - In 2019, DENR ordered the closure of 1,797 CIP (carbon-in-pulp) plants and ball mills in the gold rush area. - On 4 July 2025, President Marcos signed Executive Order No. 88 (EO 88), reorganizing and strengthening the National Task Force Diwalwal, with the DENR Secretary as its new chair. The reasoning cited was that unlicensed mining had resumed within the DMRA, with at least two rivers reportedly contaminated with sodium cyanide. - On 18 January 2024, a landslide in Diwalwal killed 11 people (including 7 members of one family). Landslides in 2005–2007 had also killed roughly 50 people.

注 A common mix-up: the 6 February 2024 landslide in Masara, Maco town, Davao de Oro, that killed over 98 people, occurred not in Diwalwal but in a separate disaster near the large-scale Apex Mining concession.

Paracale (Camarines Norte province) — "Goldtown"

Itogon (Benguet province)

The 2018 Itogon landslide (Typhoon Ompong/Mangkhut)

 Around 1pm, 15 September 2018    Heavy rain from Typhoon Ompong (international name Mangkhut)
                                   Sitio Fastgate, Barangay Ucab, Itogon town
                                   A small-scale miners' bunkhouse, "Level 070" (two connected concrete houses),
                                   buried by a debris flow
                                   Roughly 2 ha collapsed
 Rainfall                         14 September: 250.2mm; 15 September: 535.6mm (PAGASA)
                                   (far exceeding the 10mm/24hr threshold generally taken as a warning sign
                                   for ground collapse)
 Deaths                           69 as of 22 September → 78 as of 25 September (50 of them at Level 070)
                                   Final toll: 87 dead, 12 missing (29 September 2018 / DILG-CAR)
 Victims' origin                  According to the Governor of Ifugao province, 80–90% of the dead/missing
                                   were migrant miners from Ifugao province
 Aftermath                        On 17 September, Environment Secretary Roy Cimatu ordered a halt to
                                   small-scale mining in Itogon and all of CAR, and revoked all mining permits
                                   A "National Task Force Mining Challenge" was set up, closing 539 mine
                                   entrances within two days

注 DENR itself concluded that "the landslide was not caused by mining activity." MGB-CAR Director Fay Apil explained that there was no mining operation at the point of collapse, and that an extreme rainfall event coincided with an inherently dangerous terrain of shear zones and steep slopes. Nonetheless, DENR ordered a review of all Minahang Bayan applications and a halt to small-scale mining across Benguet province. 注 This suspension order was not easily lifted. As of 2022, a Benguet-elected legislator was still at the stage of promising miners to bring up "lifting the moratorium" with the new environmental authorities. "Disaster → blanket suspension → formalization does not progress → informal mining returns" is the typical outcome cycle in this sector.

Surigao/Caraga Region


5. Mercury — amalgamation and health harm

The method

Ore is crushed in a ball mill → metallic mercury is added, forming an amalgam with the gold → the amalgam is heated outdoors with an open-flame blowtorch, vaporizing the mercury and leaving the gold behind. This final step releases mercury vapor directly into the breathing zone. 注 Whole ore amalgamation, together with outdoor/residential-area roasting, is precisely the practice that the Minamata Convention, in Article 7 and Annex C, requires countries to "eliminate."

Volume of use and contamination

Indicator Figure Source
Estimated annual ASGM mercury emission/release 113 tonnes/year 2008 / DENR (using the UNEP Toolkit)
Mercury used per gram of gold average 19.2g (range 1.5–149.0g) Mercury flow-analysis study (PMUG journal, 2018)
Monthly mercury use per operator 20–40 kg 2025 / DENR-EMB-commissioned mercury material-flow survey conducted by BAN Toxics
Overall status ASGM is the Philippines' largest source of mercury emissions planetGOLD / Minamata Initial Assessment, 2019

注 The 2025 material-flow survey found that mercury use in ASGM "greatly exceeds official import statistics." In other words, the gap is entering the country through smuggling. Since the Philippines has no mercury mines of its own and domestic law and regulation are already fully in place (per Jam Lorenzo of BAN Toxics), the issue is not one of legislation but of enforcement at the border and in distribution.

Health impacts — handling "Minamata-like symptoms" with care


6. The Minamata Convention and the Philippines

Timing Matter
10 October 2013 The Convention was adopted in Kumamoto. The Philippines signed on the day of adoption
January 2016–September 2019 DENR-EMB carried out a "Minamata Initial Assessment (MIA)," updating the national mercury inventory using the UNEP Toolkit
16 August 2017 The Convention entered into force
8 July 2020 The Philippines ratified the Convention (the 123rd party)
June 2024 Convention Executive Secretary Monika Stankiewicz visited the Philippines, touring a mercury trade workshop and a mercury-free ASGM site
3–7 November 2025 COP-6 (Geneva). Over 1,000 people attended in person, and 22 decisions were adopted
2027 COP-7. IPEN is seeking to place on the agenda a convention amendment to "phase out permitted mercury use in ASGM by 2032"

The results of COP-6 — no deadline was set for ASGM

The current state of domestic implementation


7. Mercury-free technologies

注A note on the name "Borneo method"

注 As far as this research could determine, no mercury-free technology called the "Borneo method" appears in Philippine-related primary sources (unconfirmed). Two actual technologies exist and are likely being confused with one another.

Technology Content
The Borax method / Gravity-Borax Method (GBM) Originated not in "Borneo" but in Benguet province, Philippines. Ore is crushed → passed over a sluice (lined with felt) to capture heavy minerals → panned to a concentrate → mixed with borax and melted with a blowtorch, lowering the melting point so the gold settles out. Small-scale Benguet miners developed this method independently more than 30 years ago, and it is said to have been adopted by roughly 20,000 people in the region. Danish geologist Peter W.U. Appel and Leoncio Na-Oy reported it in the Journal of Health & Pollution in 2012, and this "Philippine-born technology" was subsequently transferred to Indonesian Borneo (Kalimantan) and elsewhere. This direction of transfer is believed to be the origin of the "Borneo method" misnomer
MFPS (Mercury-Free Processing System) A facility-based system installed by planetGOLD. Combines gravity concentration (spiral concentrators, centrifugal concentrators, shaking tables) with leaching using a cyanide-amino acid mixture. Tailings are detoxified with sodium metabisulfite

The economics and limits of the borax method

planetGOLD Philippines (2019–2025)

Item Content
Framework GEF-funded, implemented by UNEP/UNIDO, executed by AGC Philippines, in partnership with DENR/MGB
Duration A 5-year project (effectively 6) starting in 2019. Closing ceremony held 1 July 2025; the project itself concluded in September 2025
Pilot sites Sagada (Mountain Province) and Paracale (Camarines Norte province)
MFPS-1 (Paracale) Processing capacity of roughly 3.5 tonnes/day, gold recovery rate of 80%+
MFPS (Sagada) Processing capacity of 3–4 tonnes/day, target recovery rate of 60%+. Handed over to the Northern Sagada Barangay Small-Scale Miners Association
Improvement in recovery rate From 20–40% under amalgamation, to 80% (per MGB engineer Bernardo Vitangol). Equipment investment is projected to pay back within 3 years
Formalization Approximately 600 miners had obtained legal status by the end of 2024
Safety 48 people in northern Sagada completed a 5-day mine rescue and safety training course
Design information Project manager Abigail Ocate has said that "information is available from MGB — it's all open-source"

注 There has also been criticism. Miners have complained that "the processing facilities are too far from the mining sites to be economically viable," and BAN Toxics' Honrade has argued that "it would have been more effective to invest in reagent-free technology and stop mercury from flowing into the country." There is also a gap because only legally operating miners can use the facilities, while the majority remain unregistered.


8. Compressor mining, occupational accidents, and child labor

Compressor mining (underwater diving mining)

Child labor

Source Content
ILO (2011 estimate) 19,000 children working across 45 ASGM sites, engaged underground or on the surface in gold recovery, ore transport, and processing. 注 The ILO's ASGM child labor page (as of its December 2024 version) still cites this same 2011 estimate, and no updated 2024–2025 figure could be confirmed
HRW report (30 September 2015, launched in Manila) "'What... if Something Went Wrong?': Hazardous Child Labor in Small-Scale Gold Mining in the Philippines," 39 pages total. Field research conducted in 2014–2015 in Camarines Norte and Masbate provinces, with over 135 people interviewed, including 65 child miners aged 9–17. Children as young as 9 were documented
Nature of the danger Unstable shafts up to 25m (80 feet) deep, underwater diving mining, mercury-based gold processing. In September 2014, two brothers (aged 17 and 31) died in a shaft near Malaya, Labo town, Camarines Norte province
HRW's assessment "The Philippine government prohibits hazardous child labor by law, but enforcement is barely happening" (Juliane Kippenberg)
Domestic Philippine NGO survey 14% of children living in mining areas are engaged in mining, mostly aged 11–17
ILO CARING Gold Mining Project Funded by the US Department of Labor (USDOL). Focused on Labo and Paracale towns in Camarines Norte province, and Tboli town in South Cotabato province. Supports formalization of Minahang Bayan, piloting the ethical gold brand "Compassionate Gold" in Tboli
注 A 2017 government program initially freed the children of Malaya from labor, but many returned to hazardous work during the COVID-19 pandemic

9. Gold smuggling and informal circulation — a structure invisible in the statistics

How the system is built

Under RA 7076, the BSP (Bangko Sentral ng Pilipinas) is the only institution authorized to buy and export gold from small-scale miners, and small-scale miners are obligated to sell their gold to the BSP. The BSP refines the gold it purchases into a form usable on the international bullion market and incorporates it into foreign exchange reserves.

The 2011 tax change and the "collapse"

Year Event
1997→2011 The value of small-scale gold sold to the BSP increased from ₱4.5 billion to ₱34.6 billion
2011 A 2% excise tax plus a 5% withholding tax, for a combined 7%, began to apply. BSP purchases dropped to almost zero (a 99% decline)
2019 Official ASGM gold fell to just 1.26% of recorded gold production (₱600 million/about US$12 million)
March 2019 RA 11256 (the Foreign Currency Reserve Enhancement Act) was enacted, exempting registered small-scale miners' and accredited traders' sales to the BSP from income tax and excise tax
2020 BSP purchases surged roughly tenfold, to 115,800 troy ounces (from 10,207 troy ounces in 2019)

Why the black market still wins

Issue Content
Physical distance The BSP has only 5 buying stations (Quezon City, Baguio City, Davao City, Naga City, Zamboanga City), against dozens of declared Minahang Bayan and over 200 pending applications
Procedural cost A processing fee of ₱1,600, plus a 1% retention fee. Miner testimony: "what should take a few hours ties you up for one to two full days"
Immediate cash Miner testimony: "the black market pays less, but it's far more convenient — you get cash on the spot"
Registration requirement Miners operating illegally cannot sell to the BSP in the first place. The system spins its wheels for as long as formalization does not advance

Estimates of the scale of leakage (all are estimates with a wide margin)

System-side responses (2024–2026)


10. What the 2025–2026 gold price surge has changed

Indicator Figure Timing/source
Gold price US$4,472/oz (8/20) → US$4,587/oz (8/21) August 2026 / Fortune
Year-on-year Up US$1,130 as of 20 August Same as above
In peso terms 2026 average of ₱283,790/oz, high of ₱318,644 (1/28), low of ₱247,825 (6/10). 24-karat gold reached roughly ₱9,133/gram in late August 2026 / exchange-rates.org, policybazaar
Forecasts Goldman Sachs' 2026 outlook of US$4,900; Bank of America's US$5,000 (average forecast US$4,600) October 2025

The impact of the price surge is showing up not in "volume" but in "value" and "entry pressure."

  1. Official gold output is falling even as its value rises (Q1 2026: volume −24.7%, value +31.2% / MGB). Problems of declining ore grade and mine-life at existing operations are not solved by price alone.
  2. Only the "value" of reserves has jumped. In PSA's Mineral Accounts, the value of Class A gold reserves swelled 41.6% year-on-year to ₱308.79 billion in 2025, even as the physical volume of Class A gold reserves fell 5% to 371,260 kg, and production fell 3% to 19,550 kg. Combined Class A reserves of gold, copper, nickel, and chromite reached ₱588.12 billion (+17.6%), with gold overtaking nickel as the most valuable mineral asset. 注 A headline reading "mineral resources grew 17%" reflects a price increase, not an increase in resources.
  3. Entry pressure into illegal mining is rising. The July 2025 issuance of EO 88 in Diwalwal, the 2025 crackdown on Chinese-linked operations in Caraga, and the death threats against the mayor in Surigao del Sur are all manifestations of the same dynamic: "the higher the price, the more valuable illegal mining becomes."
  4. Large-scale operators are thriving. OceanaGold Philippines' net profit for the first half of 2026 rose +206%; Philex's Q2 2026 profit more than doubled to ₱392 million; Apex Mining has a US$300 million expansion plan underway. This contrast has created a political flashpoint over "whether small-scale miners are capturing any of the benefit of the price rise."

11. 注 Common misconceptions (summary)


12. Practical notes for research and reporting


日本語の詳細版: 分野「地下資源」「小規模金採掘と水銀問題」(本サイト日本語版)。