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I. Background Information / Additional Perspectives
Since the Philippines is highly dependent on oil imports to meet its
electricity demands, the government saw the need of initiating a series of
reforms in order for the countrys energy sector to meet the demands of the
economy. Until 1987, the generation of electricity was monopolized by the
National Power Corporation (NPC) but because of the power crisis
experienced by the country, the government allowed Independent Power
Producers to generate and sell electricity to the NPC and other customers.
President Corazon C. Aquino issued Executive Order Number 215, which
allowed the private sector to generate electricity. Moreover, R. A. 7718
enacted in May 1995 under the regime of President Fidel V. Ramos which
amended R. A. 6957 provide more opportunities for the private sector to
finance, construct, operate and maintain infrastructure and development
projects by expanding the forms of private sector arrangements to include
build-own-operate, build-lease-transfer, contract-add-operate, develop-
operate-transfer, and rehabilitate-operate-transfer power projects.
Consequently, the government allowed the construction of power
plants specifically coal-fired power plants, in different parts of the country in
the early 1990s. These plants intended to supply the much-needed energy to
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boost the countrys efforts at industrialization.
Quezon Power Limited Co. is the first privately built, owned and
operated power-generating facility in the Philippines. It has an $810 million
worth coal-fired power plant with a capacity of 440 megawatts located in the
town of Mauban, Quezon. It is built under the consortium of three big
companies namely the International Generating Co. (Intergen), a global
power generation and fuel asset development firm; Ogden Energy, a
worldwide developer and operator of independent power projects and PMR
Power, a Philippine power development company.
The said plant project includes a 31- kilometer transmission line in
Barangay Cagsiay I of the said town. It sits on a 100-hectare of land and
foreshore land the said barangay which was once part of a mountain forest in
Mauban overlooking the Lamon Bay.
Under a 25-year power sales agreement, the said project will sell
electricity to Manila Electric Company (MERALCO). Commercial operation
is scheduled to begin in the late 1999. This build-own-operate project
represents a milestone, as it will be one of the first private sectors that will
sell power to a privately owned utility. Unlike other independent projects
financed to date, it will not rely on any government performance guarantees.
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Under the consortium, Intergen, a partnership between P.G & E.
Enterprises and Betchel Enterprises, will provide management services to
QPL while Bechtel Power Corp will provide engineering, procurement, and
construction management services. Intergen is an international developer of
power projects in operation or under construction totaling 5,758 MW.
On the other hand, Ogden affiliates will provide operations services to
the power project. Ogden has over 1,463 megawatts of non-utility power
projects in operation or under construction. It is also the largest operator or
large-scale solid waste- fired thermal generating facilities in the world.
The local government officials and community members welcomed the
construction of the plant with the hope of the development promised by the
construction of the power plant. However, a huge number of the residents of
Mauban were different about the said power project. Moreover, they were not
conceding the Environment Compliance Certificate provision of Social
Acceptability set by the Department of Natural Resources.
Even before QPL was allowed to start the plants construction, several
local non-government organizations based in Mauban, Quezon particularly
the Crusade for Sustainable Environment (CSE) and the Task Force
Kalikasan (TFK-Mauban) of the Parish Pastoral Council of Mauban and
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residents of the said town expressed their opposition to the construction of
the said power plant.
Other environmental groups outside Mauban such as the Babilonia
Wilner Foundation (BWF), Greenpeace, and Legal Rights and Natural
Resources Center-Kasama sa Kalikasan (LRC-KsK) also helped in the
actively campaigned against the construction of the plant. The said groups
actively campaigned against the construction of the plant because they knew
that coal is a dirty fuel and causes pollution to the environment particularly
the air. They also foresaw plants detrimental effects on the environment and
the peoples health. However, they did not succeeded in their move of
addressing their opposition to the said power facility. It was on April 11,
1996 that DENR issued an Environmental Compliance Certificate that
mandates QPL to start its plants construction and later on operation.
In August 1996, a community Memorandum of Agreement was signed
by QPL, the Department of Environment and Natural Resources and the local
government units. The MOA provides monetary assistance and community
benefits. It also requires the monitoring activities of the $ 800 million power
plant.
The agreement also included the formation of a Multipartite Monitoring
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Team (MMT) that will oversee and check the plant for public health and
environment safety. The team was composed of representatives of QPL,
DENR, local government of Quezon Province, Mauban, Quezon, Barangay
Cagsiay I, non-government organizations and directly affected families.
MMT is the first monitoring group formed for a power facility in the
country. It is actively operating while plant construction is going on. This
was in compliance with the environmental compliance certificate issued by
the DENR.
On the other hand, the environmental organizations did not stop
monitoring the said facility. The Crusade for Sustainable Environment led by
Mauban resident, Elizabeth Mossman rallied farmers and fishermen against
the Quezon Power plant even past its construction and continued to decry
violations of its ECC issued in 1996.
DENR issued a Cease and Desist Order (CDO) and Suspension of
Environmental Compliance Certificate (ECC) in October 16, 1997,
immediately halting QPL's construction activities in Cagsiay I, Mauban,
Quezon. Much of the evidence presented to DENR was obtained by CSE,
who have been monitoring the activities and violations of QPL since their
ECC was approved. Among the residents complaints which led to the
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cancellation of the companys ECC were the wanton cutting of more than a
hundred coconut trees, intrusion of into farm lots and pollution, destruction of
roads and health hazards from the large volume of dust generated by more
than a dozen trucks passing by the houses daily.
CSE thought they finally succeeded in their motive to revoke the permit
of the said plant to construct and operate but on October 27, 1997; DENR
Secretary Victor Ramos issued an order lifting the CDO and Suspension of
the ECC after QPL submitted a solid waste management plan, a truck traffic
management scheme and a tenant compensation policy.
In a published quote, Mossman express her dismay on what had
happened. She asked why DENR lifted the Suspension and CDO based only
on the companys submitted plans. Mossman doubted about the actual
implementation.
CSE maybe dismayed on DENRs decision but it did not stop them to
monitor the construction of the said power facility. In the morning of Nov.
19, 1999, a freshly unloaded and uncovered coal stockpile was exposed to
heavy rains. This caused a coal leacheate run-off overflow that went into the
Lamon Bay when storm water flowed into the drainage ditch at the north
bypass road.
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At around 1:30 pm of the same day, the run-off basin also affected the
Cagsiay River as the heavy rains continued. The said coal leacheate caused
the discoloration of the said bodies of water.
DENR Secretary Antonio Cerilles directed officials of QPL to mitigate
the discoloration of Cagsiay River and the Lamon Bay after conducting an
aerial inspection in the area.
As many residents and environment groups joint forces in the appeal of
the closure and revocation of QPLs ECC, The said company needs to take
necessary actions to avoid this.
II. Time Context
The year 1999 will be used as the time context in this particular study.
All the facts, events, implications and laws cited in this study will be bounded
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on the said period.
III. Point of View
We are the PR department employed by the Quezon Power Limited Co.
and we were tasked to deal with the situation.
IV. Analysis
A. Situational Analysis
In this case analysis, we will state the Technological, Environmental,
Legal, and the Socio-Economic implications of the incident in Mauban,
Quezon and to the Quezon Power Limited Co.
Technological Implications
Even before the coal spill, the residents of Mauban, Quezon opposed
the construction and operation from of the said power plant. One the reason
why the residents opposed the said plant was the fear that the plant will emit
ink-black smoke that may pollute the air. Contrary to this, the plant was
equipped with state-of-the-art anti-pollution equipment that burns coal
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cleanly. With such equipment, the power plant when operational will neither
cause environmental harm nor pose any health hazard.
The equipment include high-tech devices such as an electrostatic
precipitator (ESP) that removes ash particulates, a flue gas desulfurizer
(FGD) that neutralizes sulfur compounds and special burners that minimizes
nitrogen oxides.
As a result of the installation of the said equipment, QPL is expected to
meet or even exceeded the emission standard established by the DENR.
Similar devices are now being used in coal-fired power plants in the
United States whose government and citizens are known to be very sensitive
to environmental issues.
On the other hand, on January of 1999 about 70,000 tons of steam coals
were unloaded at the power plants storage area in the preparation for the
companys full operation.
The said coal came from Kalimantan, Indonesia and was used to test
the efficiency, durability, capability, and environmental safety of the plants
coal supply.
QPL General Manager, Gregory W. Daul gave assurance that both
delivery and unloading of the said coal will be environment friendly and safe.
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Daul added that the said coal has a very low sulfur content, when burned
leaves only few ashes.
QPL was efficient in ensuring that the company has the equipment
needed for them to comply with government standards. However, the
company overlooked the possibility of coal seepage during heavy rains.
Hence, there is a need to upgrade the plants drainage system and wastewater
treatment facility in order to avoid the occurrence of another coal spill.
Environmental Implications
Coal is the most commonly used fuel in many developed countries
since it is low-priced and is widely available from many sources. The world
coal supply is enough to meet projected demands for the next 200 years or
more, unlike oil and other fuel, whose supply was expected to last only for
about 50 years.
Coal can help meet the countrys energy demand but the fact remain
that it is still the dirtiest, most carbon intensive of all fossil fuels, emitting 29
percent more carbon per unit of energy than oil and 80 percent more than gas.
It is one of the leading contributors to climate change, the single biggest
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environmental threat facing the planet today.
When fossil fuels - coal, oil and gas - are burnt, it releases carbon dioxide
(CO2) - the main human- made 'greenhouse gas'. CO2 and other greenhouse
gases create an artificial 'greenhouse effect', thickening the natural canopy of
gases in the atmosphere and causing more heat to become trapped. As a
result, the global temperature is increasing, throwing the world's climate out
of its natural balance and into chaos.
The effects of climate change are further compounded by the production
of toxins released by the burning of coal. Burning coal for energy produces
tremendous amounts of toxic wastes that, over time, destroy the communities
where these coal plants are built.
Communities living near existing coal plants are already experiencing the
effects of the said waste. Even if QPL was equipped with anti-pollution
devices, it is still expected by many environment groups that the plant will
pose environmental harm.
Residents of Mauban, Quezon had experienced the detrimental effects of
the said power plant even before the plant started its operation. Community
and environmental groups raised other issues against the power plant, and
these are the following: discoloration of the river because of a leakage in the
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ash pond where the coal was stored; flooding because of undersized drainage
canal; death in livestock and skin diseases; violations of the ECC terms and
conditions; noise pollution; conflicts in land claims; militarization; and
inadvertent use of access roads.
The complaints of the residents became even more evident as the firm
new coal stockpile got soaked during heavy rains and the leacheate seeped
into Lamon Bay and Cagsiay River causing discoloration. DENR said that
while the coal leacheate is not basically pollutive, it has affected the waters
turbidity. Turbidity refers to the clarity of water; the greater the turbidity, the
more murky the water.
In fairness with QPL, the company has not only acquired anti-pollution
equipment, it also implemented a reforestation program that aims to preserve
the vegetative cover within the plant site and adjacent mangrove areas. It
includes operating a nursery and planting thousands of plant seedlings.
Legal Implications
DENR Administrative Order Number 37, Series of 1997 provides that
major power plants in the country are considered Environmentally Critical
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contribution made by local government units or region; (2) to lessen conflict
of rights among host local government units, the people affected, the energy
resource developers or power producers, and appropriate government
agencies of the national government; and (3) to promote harmony and
cooperation among host local government units, energy-resource developers
or power producers, and national government agencies.
The policy framework included provisions for benefits for the host
community that would be affected by the construction of the power plant. On
the part of QPL, it claims to have complied with all the requirements
stipulated in the guidelines of the DENR-EMB AND the DOE. The company
established an Environmental Guarantee Fund (EGF) of Php5 million per
year to pay for claims on damages for loss of life, serious damage to property
and the environment, and for pecuniary loss or damage suffered by a person
or an entity as a consequence of pollution and/or environmental degradation
arising from a violation of environmental laws and DENR regulations
Likewise, QPL also set up a Multicultural Monitoring Fund to pay for the
honoraria of the members of the Multipartite Monitoring Team (MMT) and
the EGF Committee. It was reported that QPL spent a total of Php 6 million
on the activities of the MMT and the EGF Committee since 1997. The MMT
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is composed of 10 members and chaired by the Provincial Environment and
Natural Resources Officer (PENRO) while the committee for the EGF has 9
members and is chaired by the Regional Executive Director of the DENR.
Even if QPL followed the directives of DENR in the construction of the
power they still violated the provisions of
Presidential Decree No.1586 that states power facilities should
ensure that their proposed project or undertaking project will not cause
significant negative environmental impact. Hence, the company is also liable
to fines.
Quezon Power Limited Co faces a threat of yet another cease-and-
decease order from the DENR and suspension of their ECC. If not properly
handled by the management, the problem may provoke the authorities to
order the closure of the said power facility.
It may also undergo another public hearing presided by the Congress
just like what happened in 1997 wherein House Resolution number 1409 was
authored by Quezon Rep. Wilfredo L. Enverga directing the House
Committee on Natural Resources to conduct an inquiry into the alleged
irregularities committed by QPL.
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Socio-Economic Implications
The construction of the Quezon Power Plant promised drastic
developments concerning the livelihood of the residents of Mauban, Quezon
and even the construction of infrastructures such as roads. In accordance to
the provisions of DENR, QPL must do necessary programs or projects for
benefit for their host community. QPL promised to do their part for the
development of the community. Hence, most local officials and residents
welcomed the project with much hope.
As early as 1998, QPL started to help its host community. In December of
the same year, the Cagsiay I Multi- purpose cooperative registered with the
Cooperative Development Authority. The said cooperative is a part of the
livelihood program instituted by QPL. The project is a self-help program
where the skills of the members of the cooperative were developed as the
funds of the group grow. The cooperative offers training, seminars and
workshops to hone the skills of the members. The cooperative signed a
Php800, 000 worth of contract with QPL project manager Richard Collins for
the consortiums program.
On the other hand, most of the Residents of Barangay Cagsiay I in
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Mauban, Quezon depends on farming and fishing for their livelihood. With
the construction of the said power plant, a large agricultural land was turned
into industrial to make up for construction of the said facility. Moreover, the
coal spill that happened near the power plant had affected the marine
environment near the place thus affecting the livelihood of the Maubanians
fishermen. Even if the coal spill is not pollutive, consumers are still afraid to
buy fishes and other sea foods coming from the affected bodies of water. The
livelihood programs of the said power plant are not enough as many residents
are afraid to venture in other forms of living.
Nanding Manuba, a resident of Mauban, Quezon said that since the
plant was built, he had experienced pulling up his crab-nets and finding all
his crabs black and strange looking. Furthermore, he stated that the villagers
go to the coast to sweep the carbon off the beach whenever coal spills out
from their stockyard. In addition, some residents gave the carbon back to the
coal plant while others had to bury them under the sand. Manuba expressed
how sad he was when he noticed the water getting darker and how the black
water was overflowing from the plant site. Manubas statement represents the
sentiments of most of the residents.
Not all residents of Mauban Quezon appreciate the companys
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programs. The residents cant forget the previous ECC violations of the
company. As the coal spill happen, the number of residents opposing the
plants full operation also outgrew. A study conducted to measure the social
acceptability of the QPL power plant disclosed by environmentalist groups
showed that residents living the projects site strongly favor the completion
of the power facility while those residing in barangays opposed its
construction. Hence, there is a need for the company to reach out to other
barangays as well.
They even wonder why the government allowed the construction and
operation of the said facility amidst the fact that it is detrimental to the
environment and to their health as well. They felt that QPL is insincere with
its promise of development since it violated the primary provisions of ECC
that they must ensure the safety of their host community.
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B. SWOT Analysis
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V. Problem / Opportunity Statement
The occurrence of the coal spill could be a reason for the government to
Strengths
Owned by multinational
companies
Supported by Mauban Mayor
Fernando Llamas and Brgy.
Cagsiay I Chairman Oscar
Juqueta
Weaknesses
Issued cease and desist order and
suspension of environmental
compliance certificate in
October, 1997 by DENR
Environment groups and some
residents of Mauban oppose the
construction of the plant.
Opportunities
Upgrade the technology and
facilities in the power plant
such as proper drainage system
and wastewater treatment
facility
Chance to gain social
acceptability through
community-based projects
Threats
Negative write-ups about the
company
Possible closure of the power
plant
Increase in the number of
environmental groups that are
campaigning for the closure of
the power plant.
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stop the continual construction of the Quezon Power Limited Co. and since
that time, a huge amount of money had already been spent for the plant, it
would be a big loss for the owners of the said power facility. However, if this
problem is handled properly, this could be an opportunity for QPL to gain
social acceptance from the residents of Mauban, Quezon and environment
groups as well.
VI. Objectives (General and Specific)
The overall goal of our crisis communication plan is to avoid the
possible closure of the Quezon Power Limited Co. Specifically, we aspire to:
Assure the residents of Mauban, Quezon specifically of Barangay
Cagsiay I and the environmental groups, such as the Crusade for
Sustainable Environment and other environment groups that the coal
spill wont happen again.
Implement an environmental program to integrate environmental
protection into QPLs business operations.
Cultivate good relationship with the people of Mauban, the companys
host community to gain social acceptability for the companys
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continuous operation.
VII. Targeted / Segmented Publics
The residents of Mauban, Quezon is the primary target of our crisis
communications plan since they were the ones who were affected by the
occurrence of the coal spill.
Our secondary target is the local media in the province of Quezon
particularly the newspapers and radio stations; environment caused oriented
groups based in Mauban, Quezon such as the Crusade for Sustainable
Environment, and the Task Force Kalikasan Mauban and other environment
groups concerned as well; the local government of Mauban, Quezon; the
Department of Environment and Natural Resources and the companys client-
MERALCO.
VIII. Alternative Courses of Action
ACA No. 1 Take Full Responsibility
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Quezon Power Limited Co. must take full responsibility on the
incident. The company must express regret to the residents of Mauban,
Quezon for the occurrence of the coal spill through the local media. The
company will also assure the residents of Mauban, Quezon, environment
groups, local government and its client- MERALCO that the company is
already adhering to the standards and policies set by the Department of
Environment Natural Resources and doing necessary actions to solve the
problem. Accordingly, the company will undertake necessary changes within
the company to prevent the occurrence of the same incident.
ACA No. 2 Offer Bribes to All Concerned People
The company should bribe the local government officials and DENR
officials assigned to monitor the power project in order for them to ignore the
complaints and allegations of the environment groups.
ACA No. 3 Ignore the Complaints
QPL must ignore the complaints of the concerned residents and
environmental groups and continue the construction of the power plant. The
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the actions that the company will undertake immediately to solve the
problem. On the other hand, the long-term action plan includes the set of
actions that the company will undertake in order to achieve its objectives.
A. Short-Term Action Plans
Actions within the next hour after the coal spill: FORMATION OF AN
INVESTIGATING COMMITTEE
A committee composed of the plants general manager Gregory W.
Daul, plant construction manger Richard Collins, plant engineers and PR
head Litz Santana will be formed to investigate the incident and decide on
what actions are necessary to undertake to mitigate the situation. The
company representatives of QPL will go to Lamon Bay and Cagsiay River to
assess the impact of the said coal spill.
Aside from its own investigating committee, the company will also
commissioned an environmental engineering and consulting firm to
independently investigate the coal seepage that flowed to the shorelines
immediately in front of the project site. The said committee will provide a
report and suggestions to the company about the actions they must do to
immediately solve the problem brought by the coal spill. Moreover, they will
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also suggest specific actions that QPL must do to prevent the occurrence of
another coal spill. They will also aid in the actual clean-up operation.
Actions within the next six hours: PRESS RELEASE
Because of heavy rains, QPL cant immediately start its clean-up
operation. The first action that the company will do is to give an official
statement regarding the coal spill through a press release to the local
newspapers and local radio stations. The press release will include the ff:
The companys regret about what happened.
The companys willingness to face their responsibility on what
had happened.
The actions that the company were undertaking to solve the
problem.
The actions that the company will undertake to prevent the
occurrence of the similar incident.
The companys pledge to help in the development of the
community.
Actions within the next 24 hours:
START OF CLEAN-UP OPERATION
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With the help of the environmental firm, QPL will immediately start
the clean-up operation of the coal spill at Lamon Bay and the Cagsiay River.
The company will also cover the newly delivered coal stock in order to
prevent the coal leacheate from escaping from the exiting stockpile.
COORDINATE WITH THE CLIENT AND THE AUTHORITIES
The company will also coordinate with the Department of
Environment and Natural Resources and comply with the directives of the
said regulating body through the Multipartite Monitoring Team. QPL will
also give periodic reports to the projects MMT about the mitigating activities
of the said power firm.
QPL will ensure MERALCO, the power facilitys client that the
company is doing necessary actions to solve the problem and comply with
the directives of DENR in order to avoid the plants closure.
Actions within the next 48 hours: DIALOGUE
QPL will also conduct a dialogue with the local government officials
such as Mauban Mayor Fernando Llamas and Barangay officials of Mauban,
Quezon, representatives of the Crusade for Sustainable Environment and
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TFK-Mauban and community members in order to express the companys
regret on what had happened and assure them that the company is taking
necessary actions in order to prevent the occurrence of the similar situation.
Through this dialogue, QPL will explain the caused of the coal spill.. QPL
General Manager Gregory W. Daul will state that the company had started
the process of covering the newly delivered coal stock and had instituted
other mitigating measures that had been proven effective in preventing coal
leacheate from escaping from the existing stockpile.
This dialogue will also give opportunity to the said participants to ask
questions regarding the coal spill and other environmental issues of the said
plant.
QPL will invite the said participants to the power plant to show their
anti-pollution equipment. This aims to eradicate the fear that the company
will pose further environmental harm when it is operational.
Furthermore, the company will also reiterate the companys
commitment to help in the development of the community.
B. Long Term Action Plan
ENVIRONMENTAL MONITORING PROGRAM
To uphold its commitment to sustainability and environmental protection,
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Quezon Power will also undertake an intensive environmental monitoring
program. The program will serve as an important part of the plants
compliance with the requirements of its Environmental Compliance
Certificate (ECC), which was issued in 1996. This program will help the
company to avoid the previous violations of the company.
To ensure that the coal spill wont happen again, QPL will monitor the
plant and conduct a coastal clean-up in a quarterly basis. Moreover, the
company must facilitate a proper drainage system leading to a wastewater
treatment facility that will avoid coal seepage in case of heavy rains.
The company will continue its reforestation program. It will facilitate
over 100,000 indigenous trees and plants along the plant site.
SUSTAINABLE DEVELOPMENT PROGRAM
On the other hand, to show that QPL adheres to its promise of
sustainable development, the company will continue to implement
sustainable development programs. Asenso, Mauban!, is a long-term program that focuses on education, health, environment, livelihood,
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infrastructure development and community relations. The programs are
largely geared towards freeing the people of Mauban, Quezon from the
clutches of poverty thus, enabling them to be productive citizens.
The said program also aims to reduce cases of malnutrition,
dependency, and illiteracy in the said town. Through feeding program, QPL
will assist elementary students suffering from malnutrition. It also conducts
regular medical and dental missions through free clinics at the plant site and
community visits.
In cooperation with local government and community-based
organizations, QPL will continue its support in the construction of basic
social infrastructure in the municipality such as roads, bridges, schools, water
system, markets, health centers, and a stable and reliable electricity
infrastructure.
Under its sustainable development program, QPL will also initiate
skills enhancement and livelihood development programs. A project that
aims to enhance the training skills of public elementary school teachers in the
field of Math, Science, and English will be implemented. Also, QPL will
provide training programs to farmers and small entrepreneurs. They will also
provide vocational-technical scholarship program for out-of-school youths.
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Moreover, residents will be given trainings on meat processing,
cosmetology, massage trainings, construction painting, and cooperative
development to enable them to augment the income of the residents of
Mauban, Quezon
INFORMATION, EDUCATION AND COMMUNICATION
PROGRAM
In coordination with DENR, QPL will also conduct information,
education and communication programto various schools and villages within
the province of Quezon on bio-diversity, forest conservation, proper waste
management and sustainable development practices.
PUBLIC SERVICE ANNOUNCEMENT
A public service announcement will be featured in local radio stations
that aim to highlight the companys role in the development of Mauban. The
said PSA also aims to motivate the residents of Mauban to be responsible
citizens of the town.
With the implementation of the said actions, it is expected that QPL
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will earn acceptance from the residents of Mauban and the environment
groups.