The government, through the Mines and Geosciences Bureau (MGB), generated a total of PhP2.69 billion in royalties paid by mining companies operating within mineral reservation areas during the fiscal year 2014. The amount represents 5% of the market value of the gross output of the minerals produced during the period.

In 2013, the actual royalty earnings reached PhP1.31billion.

At present, the government-declared mineral reservation areas are located in Zambales (Region III), Surigao del Norte, Surigao del Sur and Dinagat Islands (Region XIII).

Under Section 5 of Republic Act No. 7942, or the Philippine Mining Act of 1995, 10% of the amount collected will accrue to the MGB for "special projects and other administrative expenses related to the exploration and development of other mineral reservations." The other 90% will be divided between the national government (60%) and the local government units (40%) where the minerals are located.

Joint Circular No. 2010-1 between the Department of Environment and Natural Resources, Department of Finance, Department of Budget and Management, and Department of the Interior and Local Government provides the guidelines on the release of the share of local government units from royalty payments.

By: Finance Division