PaganWatch: JG Sablan permit is ‘void’

Citing documents obtained from the Marianas Public Lands Authority, PaganWatch insisted yesterday that the Pagan mining permit issued to JG Sablan Rock Quarry Inc. had been voided by MPLA.

The watchdog group also called on MPLA to announce the termination of the mining permit and to start the Pagan mining task force that the agency had resolved to create.

“As a result of its recent Open Government Act Request, PaganWatch obtained and reviewed public documents provided by MPLA, regarding the mining operations of [JG Sablan] on the island of Pagan, and discovered that the mining permit given to JG Sablan is either void or being voided,” PaganWatch said in a press release.

JG Sablan has recently formed a joint venture company with the California-based Bridgecreek International Corp. The new business partners have now taken steps to begin mining operations in Pagan using JG Sablan’s permit.

PaganWatch has maintained, however, that any mining operations on Pagan should be stopped until a mining task force has been created and a comprehensive study of Pagan pozzolan and the possible environmental impact of extracting the material from the northern island is completed. PaganWatch has also repeatedly called on the government to conduct a bid for all investors interested in Pagan pozzolan.

Earlier this month, PaganWatch submitted an Open Government Act request for all the documents pertaining to JG Sablan’s permit.

PaganWatch found that the mining permit issued to JG Sablan on Sept. 8, 1995, never included an exact description of the area in which JG Sablan could operate on Pagan.

The group also noted that JG Sablan’s permit was amended on Feb. 15, 1996 to provide that the permit could be automatically terminated if the company failed to generate and or report any revenue to the government from its mining activities for two consecutive years.

The amendment also provided that MPLA could declare the permit void by simply giving 60 days notice to JG Sablan and giving JG Sablan 60 days to request a hearing on the alleged violations. After that, MPLA may use any available remedies as a result of the breach by JG Sablan.

PaganWatch said that MPLA issued a notice of violation to JG Sablan on Feb. 19, 2004.

“Although the notice of violation was not itself produced by MPLA, both MPLA and JG Sablan in produced correspondence indicate the violation was issued because JG Sablan: failed to pay MPLA at least $483,637.56 in rental and royalties due by JG Sablan for Pagan mining; failed to submit required reports to MPLA showing the amount of materials removed from Pagan by JG Sablan; failed to obtain MPLA permission to erect structures on Pagan; failed to submit a proposal indicating how JG Sablan intended to develop a pozzolan and basalt on Pagan; and failed to secure public liability insurance for its Pagan activities,” the group said.

PaganWatch cited a July 18, 2004 letter wherein MPLA’s counsel informed JG Sablan’s counsel of the company’s failure to cure the violations or request a hearing within the 60-day deadline. As such, the JG Sablan permit stood to be automatically terminated.

PaganWatch also said that MPLA chair Ana Demapan-Castro herself confirmed that the permit of JG Sablan had been terminated, when she stated in a June 22, 2004 letter to JG Sablan’s counsel that “The decisions whether to reinstate JG Sablan’s Pagan Quarry with conditions remains a decision of the full board.”

“Obviously, something can only be ‘reinstated’ if it has first been revoked or terminated. The conclusion being that JG Sablan’s permit was, in fact terminated,” the group maintained.

Furthermore, the organization said that, from the documents produced, it appeared that MPLA and JG Sablan have attepted to settle the matter. The two parties have also drafted settlement agreements, but they have not been executed because there appears to be disagreements over area, rentals, royalties and other terms of the permit.

“The termination of JG Sablan’s permit and their eviction from Pagan present the citizens of the CNMI with the opportunity to finally look at the resources of Pagan and, with the participation of all stakeholders, to determine a development strategy that will bring the best possible returns to the CNMI. It is an opportunity to ‘do it right’ so that the CNMI gets a fair share of revenues and protect Pagan’s rich cultural and natural resources as well,” PaganWatch said.

According to the group, this can be done by forming the Pagan mining task force, which MPLA had agreed to form when it set aside an investor’s proposal on Dec. 5, 2004.

The purpose of the task force is to determine the actual quantity and quality of pozzolanic ash available on Pagan, to find a suitable investor who can extract and market the material, and to support the project by defining all requirements in advance.