Northern Islanders remember

Most Northern Islands residents remember the last time that JG Sablan Rock Quarry’s president asked them to support his Pagan mining venture.

Broken promises: John Sablan did not deliver on his promises of a trust fund, jobs, buildings, and free cargo and passenger transport. What little transport was provided to the Mayor’s Office was followed by an invoice, according to a Public Auditor’s Report. No residents were offered jobs on his limited Pagan mining operation, nor in any of his other CNMI businesses. On a government trip to Pagan in 2004, JG Sablan’s workers were seen loading tons of pozzolan in bags for shipment to Saipan. The workers were undocumented Chinese and Filipinos. Not even these unskilled jobs were offered to Pagan residents. In the 10-plus years since the permit, John Sablan has done nothing to help the residents of Pagan resettle.

Environmental issues: Last year, the government of Yap charged Mr. Sablan with polluting the island’s main harbor with petroleum. The Yap EPA investigated at least eight separate reports of oil spills and environmental violations by Sablan’s vessel, MV Cecilia, which he abandoned in Yap. Multiple attempts to compel Sablan and a co-defendant to remove the ship were ignored. Mr. Sablan will say that the charges against him were dropped. He’s correct—but only due to “lack of jurisdiction.” The Yap court imposed a default judgment against Sablan’s co-defendant amounting to more than $12 million.

The CNMI Division of Environmental Quality discovered large releases and extensive soil contamination with used oil at JG Sablan’s maintenance facility here on Saipan. In March 2005, US EPA inspectors discovered 2,000 gallons of used oil and 85 severely corroded and leaking 55-gallon containers of used oil inside the facility, heavily oil-stained soil under 50 additional containers and on the surrounding soil, and many other leaking containers, vehicles, and lead acid batteries throughout the facility.

On Pagan, rusty, leaking 55-gallon diesel oil drums, old tires, old rusty equipment, and debris from JG Sablan operations litter the island as documented by KMCV’s Chris Nelson during a trip to Pagan in 2004. This is the reality of John Sablan’s commitment to the environment.

Money facts: John Sablan claims that his joint venture with Bridgecreek will bring revenues to the CNMI. In reality, it would lead to the loss of many millions in potential revenues because JG Sablan only has to pay $2.50 per ton for pozzolan no matter what the pozzolan sells for. Assuming a cost of production of $20 per ton, and 1 million tons of pozzolan sold:

– When the sales price is $35/ton: CNMI gets $2.5 million, JG Sablan-Bridgecreek gets $12.5 million

– When the sales price is $50/ton: CNMI gets $2.5 million, JG Sablan-Bridgecreek gets $27.5 million

– When the sales price is $90/ton: CNMI gets $2.5 million, JG Sablan-Bridgecreek gets $67.5 million

That’s for a million tons. It is estimated that there are over 200 million tons of pozzolan on Pagan! The potential loss of revenue is staggering.

John Sablan claims that he is paid up on his Pagan fees and royalties. In reality, when his latest Pagan permit was issued in 1995, the company was already in arrears by over $2.75 million in unpaid fees, rentals, royalties and interest on various mining and quarry permits. Of this, $192,000 was for Pagan mining. Since then, JG Sablan should have been paying an additional $20,000 per year in new permit fees. Sablan’s claim to be “paid up” when in fact he failed to pay millions and deprived the CNMI of Pagan mining revenues for over 15 years is ridiculous!

Mr. Sablan also makes an unsubstantiated claim of having invested $7 million of his personal funds in Pagan mining development. If it is true, so what? Where is the result? Where are the profits promised to the CNMI over the last 15 years? What kind of businessman spends $7 million in the face of, in his words, “minimal world demand for the project”? These are the questions that Bridgecreek should also be asking itself as it considers putting its funds in a JG Sablan bank account.

Fool me once, shame on you. Fool me twice, shame on me: John Sablan made his promises and got his chance. He has cost the CNMI millions in uncollected revenue, and many millions more in lost opportunities. Sablan’s track record cannot be swept under the table. He is no friend of the Pagan residents, and he is no friend of the CNMI people. Other investors are interested in bidding on the Pagan mining project and are willing to be scrutinized by the Multi-Agency and Community Task Force as soon as it is formed. JG Sablan and Bridgecreek, on the other hand, do not want the Task Force to be formed as it would force them to bid against other investors. The people of the CNMI deserve the best. Nothing more and nothing less.

Cinta M. Kaipat
President, United Northern Mariana Islanders Association (UNMIA)

Peter J. Pangelinan Perez
PaganWatch