QuestionsQuestions (Republic Act No. 5092)
All geothermal sources or occurrences of geothermal energy, natural gas, and methane gas in public and/or private lands in the Philippines belong to the State; they are inalienable and imprescriptible, and their exploration, tapping, and utilization are governed by the Act.
No. Section 4 states that ownership or right to use land for other purposes does not include the ownership of, nor the right to explore for, tap, or utilize, geothermal energy, natural gas, and methane gas.
No permit is required if exploration is undertaken by the owner of the land himself or by his agent. Also, if geothermal/natural gas/methane is already being used for domestic purposes at the time the Act takes effect, the user may continue similar or lesser domestic use without a permit unless the Director of Mines otherwise directs.
The individual must be a Filipino citizen, of legal age, and have the capacity to contract obligations.
It must be duly organized under Philippine laws, and at least 60% of its capital must be owned and held by Philippine citizens at all times.
They may enter and re-enter upon private lands for geological/geophysical studies and making bores, upon written notice at least 10 days in advance, with liability to indemnify for material damage. They cannot authorize occupancy of private buildings, yards, or gardens against the will of the owner.
The permittee/lessee may apply to the municipal court, and upon posting a bond fixed and approved by the court, the court issues an order allowing entry pending final determination of the proper amount to be paid.
Section 9 mainly covers entry for studies and making bores, with indemnification for material damage. Section 10 concerns temporary or permanent occupancy/easements over private lands when needed for essential works and may involve court-authorized use with bond, covering reasonable rental/value and compensation for resulting damage.
When occupation of private land is needed by the permittee/lessee for constructing, maintaining, operating, and drilling bores and related public-use-benefit facilities (e.g., pipelines, tanks, powerhouses, transmission lines, wharves, terminals, etc.), eminent domain may be exercised by the Government through the permittee/lessee in accordance with applicable eminent domain laws.
Except lands covered by armed forces reservations, public lands may be entered by the permit/lease holder if covered by the permit/lease. If easement/temporary or permanent occupancy is needed, the Director of Mines may grant it with due regard to prior rights of third parties and the reservation’s purpose; the necessity presumption in Sec. 10 also applies.
It must include a plan with boundary bearings/distances and latitude/longitude to the nearest second; it is filed with the Director of Mines who examines qualifications and authorizes publication of notice at least once a week for three consecutive weeks in the Official Gazette and an English newspaper of general circulation in Manila.
During the publication period, an adverse claim stating nature and grounds may be filed with the Director of Mines. If no adverse claim is filed within that period, it is conclusively presumed no adverse claim exists, and thereafter no adverse claim from third parties shall be heard.
A permit grants the exclusive right to explore the block, do geological/geophysical work, and conduct drilling operations and related exploration/discovery work. The actual production and utilization of geothermal energy/natural gas/methane gas discovered is not included in the permit right.
Each calendar year after application (and before start of each year), the permittee must spend at least P2 per hectare per year (or fraction thereof), with a minimum total amount per permit not less than P1,000 a year, supported by technical reports submitted within 90 days after the end of the corresponding year.
It is sufficient cause for cancellation of the permit by the Secretary of Agriculture and Natural Resources upon recommendation of the Director of Mines, with termination of the permittee’s right and without prejudice to collection of the difference between required minimum and actual spending. The permittee cannot be granted new/additional areas/rights until defaults are corrected.
Initial term: not more than 3 years. Extension: up to two years if at least one well totaling not less than 1,000 feet is drilled and requirements complied with. A further extension of up to two years may be granted if, during the first extension, wells totaling at least 2,000 feet are drilled and requirements complied with. No further extension beyond 7 years from original issuance.
A permit holder may apply for a lease during the life of the permit if a discovery is made, it is determined to be of commercial value, and the holder is ready to produce/utilize or put it into commercial use.
Royalty is 1.5% of the market value of the energy or gas produced and utilized for commercial purposes.