The Philippines’ Rich Mineral Endowment Still Largely Untapped

The Philippines is filled with the minerals that global manufacturing and technology firms, and militaries require. It sits among the world’s top five countries for nickel, copper, and cobalt reserves, ranking fourth globally in copper ore (~4.41 billion tons), fifth for nickel (~5.29 million tons), and holding approximately 286,000 tons of cobalt (~4 percent of global reserves).

The archipelago’s untapped critical and rare-earth mineral reserves are estimated by the government to be valued at over $1 trillion, with only 5% of these reserves being explored, and mining contracts covering just 3% of them. The poor track record of extracting minerals from the ground can be attributed primarily to the Philippine Constitution which requires exploration and development of natural resources to be carried out by firms 60% Filipino-owned. Full foreign control is possible only via FTAAs that require presidential approval with complex contracts and investor obligations to be agreed. Lack of reliable and affordable power, transport infrastructure, community backlash, and water shortages are examples of other issues hindering the industry. As a result, mining contributes about 1 percent of GDP.

Nickel, Copper, Gold: The Philippines Mining Base

In 2024, mineral exports totaled $7.37 billion (up from $7.32 billion in 2023). Nickel ore remains dominant, with around 59.5 million tons exported, 80% going to China, the remainder to Indonesia. By value, gold led at $2.21 billion, followed by copper at $480 million. At year’s end the country had 58 operating mines (36 nickel, 11 gold, 3 copper, plus chromite and iron). 

In global terms, the Philippines is a second-tier minerals country, with the notable exception of nickel, where its ore production is significant. Within Southeast Asia, its resource base is meaningful, but on a gold-copper-nickel reserves-by-value basis, it sits outside the global top ten, well behind Australia, Russia, Chile, Indonesia, Peru, the DRC, Mexico, and the United States.

Nickel

The Philippines is the world’s #2 nickel producer after Indonesia, ahead of Canada, China, Australia, and Brazil. Roughly 80% of exported ore goes to China to feed its large Chinese nickel pig iron (NPI) and stainless smelting base, with most of the remainder to Indonesia for blending and feed flexibility. Indonesia now produces about seven times the Philippines’ contained nickel annually, underscoring its dominance.

Local processing occurs but is limited to two High-Pressure Acid Leach (HPAL) plants in Coral Bay (Palawan) and Taganito (Surigao), both producing mixed nickel-cobalt sulfide (MSP) to be further refined in Japan. Nickel Asia and Global Ferronickel were contemplating a $2 billion investment in new nickel plants in 2023, but the investment was derailed due to Indonesia’s recent surge in production which has flooded the market making new projects harder to justify. From 2023 to 2025, nickel prices fell about 30%, squeezing project returns.

Policy shifted too. Manila floated a raw-ore export ban to emulate Indonesia’s strategy after Indonesia vaulted past the Philippines by banning ore and pulling in large smelter investments. The idea was ultimately dropped in favor of investment incentives and a push for additional processing plants, aiming to move the industry up the value chain rather than choke off current cash-flowing exports.

A hard ban would have constrained important industries in China as the Philippines is one of the last major suppliers of unprocessed laterite ore. It also would have hit the Philippine maritime trade, where nickel ore makes up over 70% of dry-bulk commodity exports, and risked near-term losses in export receipts and local royalties before new domestic processing capacity came online. The Philippine Nickel Industry Association even publicly welcomed dropping the ban citing the true causes for lack of in-country refining as power costs, infrastructure gaps, capital requirements, and ramp-up risks.

Gold & Copper

Nickel is the workhorse by volume, but gold leads by value. In 2024 the country produced ~928,000 oz of gold worth ~$2.21 billion, versus ~$1.65 billion for nickel. The Philippines also produced ~283,000 tons of copper concentrate worth ~$480 million. With limited in-country smelting capacity, most value-add is captured offshore. PASAR in Leyte, the only copper smelter and refiner in the Philippines, processes imported concentrates into copper cathodes. The plant was shut down in 2025 amid record-low global treatment and refining charges. In July 2025 Glencore agreed to sell PASAR to the Villar family, with a restart expected when market conditions improve.

Other Minerals

There have been unsubstantiated claims that a discovery has been made in Mindanao of a rare earths deposit exceeding those found in Canada, Australia, and South Africa. No code-compliant resource (i.e., JORC) or official MGB release validate the figures. The chatter is plausible in principle because the Philippines sits in tropical, deeply weathered belt suited to ion-adsorption clay–type REE deposits, and REE occurrences have been documented in Palawan. Other rare earth minerals potential exists during the refining process of nickel.

Beyond the big three and rare earths, the Philippines also produces silver (mainly as a by-product at Masbate, Didipio, Padcal, and Carmen Copper), chromite (Eastern Samar and Zambales), and magnetite iron-sands (Leyte and Bulacan). These are modest in dollar terms compared with nickel and gold, but they round out the country’s metals mix and keep multiple regional supply chains engaged.

Policy and Permitting Overview

The Philippines lets miners mine in two ways: 1) through agreements held by companies that are at least 60% Filipino-owned, or 2) as a full foreigner owner through a usually difficult to obtain and maintain FTAA. The 60/40 rule dulls foreign sponsors’ incentives because minority owners carry capex and permitting risk with limited control and diluted upside. OceanaGold’s Didipio is the textbook FTAA case. When its FTAA expired in June 2019, operations were suspended for two years amid local opposition, and only restarted after renewal in July 2021. FTAA approvals are discretionary and can add costly years to timelines.

Even where the 60/40 rule can be overcome by an FTAA, projects often face community and tenure hurdles. A large share of mineralized uplands overlaps ancestral domains, triggering buy-in and royalty requirements from Indigenous communities, and disputes or local ordinances can delay or reshape projects. High power costs and patchy road and rail infrastructure further challenge processing economics versus regional peers.

Taxation is not the main constraint. The effective take is a 4% excise on gross output plus a 5% royalty only inside mineral reservations, with a profit-based 1% to 5% royalty slated outside reservations. This is generally lower than Indonesia’s price-linked nickel royalties of about 14% to 19%, a country that attracted about $11.6 billion in smelter investment in 2023 to 2024 and lifted mined nickel output by around 180% since 2020.