A proposed Indonesia-style ban on exports of unprocessed metal ores from the Philippines may not be implemented for about seven years, the proponent of a bill before Congress said on Tuesday, potentially easing pressure on nickel prices.

Congressman Erlpe John Amante said a law aimed at forcing miners to process raw minerals before export could take two years to be enacted, while miners deserved a five-year grace period before mandatory domestic processing took effect.

News last week of the proposed legislation has unsettled the nickel market, which was caught off guard when Indonesia banned nickel ore exports in January. Nickel jumped 7 percent in four sessions to Monday's close and is up 41 percent this year.

The Philippines currently supplies China with virtually all of the nickel ore that it uses to make nickel pig iron, a raw material used by steelmakers, following the Indonesian ban.

Amante said the Philippines could triple its revenue from mineral exports if his bill, which was filed in July and has been approved at the committee stage in the lower chamber of Congress, becomes law. A matching bill was filed in the upper house Senate in late August.

"We've started the ball rolling so I'm very hopeful with the timeline," he said in an interview with Reuters in his office in Congress, adding that he hoped the bill would become law within two years.

The bill, which has government support, does not contain a timeframe for a ban on mineral exports, but Amante said he believed miners should be given a five-year grace period that would be implemented by regulation.

"I think five years will be fair enough for investors to put up processing plants," he said.

Indonesia passed similar legislation in 2009 but many miners did not prepare for the ban in the belief that the government would back down.

"If we're talking about seven years until it is actually implemented, this will certainly take some of the upward pressure out of the nickel price," said Stephen Briggs, metals analyst with BNP Paribas in London.

GOVERNMENT SUPPORT

Environment and Natural Resources Secretary Ramon Paje, in a separate interview, said the government would support the identical bills filed in both chambers of Congress.

"Our proposal is to go for the banning of ore exports on the condition that in the draft bills there will be a support system for the establishment of processing plants," Paje told Reuters.

The country's high power costs were the "number one disincentive" for miners, he added.

The Philippines, which has vast but largely untapped mineral resources, has been looking at ways to raise the contribution of mining to its economy. The government has also been seeking a bigger share of mining revenues, a proposal rejected by miners who say they are already paying too much taxes.

Last year the Philippines produced 99.3 billion pesos ($2.3 billion) worth of precious and base metals, including nickel ore worth nearly 30 billion pesos, data from the Mines and Geosciences Bureau showed.

It currently has one copper smelter owned by global commodities trader Glencore's local unit Pasar, two for gold, and two for nickel, both owned by Nickel Asia Corp, the Philippines' top producer partly owned by Sumitomo Metal Mining Co Ltd.