Amendment to Coal Development Act

Section 9(a) is amended to specify that the government shall reimburse the operator for operating expenses not exceeding 90% of gross production proceeds annually.
If operating expenses exceed 90%, excess is recoverable from future operations.
Operating expenses are defined as total expenditures related to coal operations under the contract.

Section 10 is amended to allow holders of valid exploration and exploitation rights who have organized their area into a coal unit to receive a special allowance.
Special allowance shall not exceed 40% of the balance of gross income after operating expenses.
Coal contracts with Filipino citizens or corporations are entitled to special allowances not exceeding 30%, or 20% if Filipino ownership is at least 40%.
Filipino corporation is defined as one with at least 60% capital owned by Filipino citizens.

Section 11(a) amended to require operators to spend at least P1,000,000 per coal block annually on exploration.
Reduction to P200,000 per block is allowed for areas suitable for open pit mining.
After commercial reserves determination, operator must develop and produce according to negotiated amounts.
Operator may concentrate exploration work on selected blocks with Board approval.
Excess exploration expenditures in a year may be credited to future years.
Failure to meet work obligations requires payment of the shortfall to the government.
At least 30 drill holes per block with specified minimum footage is required, subject to possible reductions by the Board for technical reasons.

Declaration that coal exploration, development, and exploitation is a public use allowing eminent domain for private lands.
Operators must give prior written notification to landowners and occupants before entry.
If entry is denied or notification is not received, operator notifies the Energy Development Board and posts a bond.
Compensation to surface owners varies by land type:
- Torrens Title lands: minimum P1.00 per ton of coal extracted plus compensation for damaged crops or improvements.
- Untitled or incomplete title lands: minimum P0.50 per ton plus compensation for damages.
- Government reserved lands subject to regulations and compensation split between agencies.

Operators allowed to cut timber as necessary for coal operations, subject to applicable laws and Bureau of Forest Development rules.
If timber concessions exist, cutting and removal of timber must be agreed upon with concessionaire or resolved by the Energy Development Board.
Operators must perform reforestation as mandated by forestry regulations.

Operators entitled to necessary water rights through application with the Bureau of Public Works under existing water law.
Existing water rights are protected.
Government reserves the right to regulate water use to prevent monopoly and ensure equitable distribution.

Penal provisions under Chapter XIV of Presidential Decree No. 463 apply to coal operations.
References to the Decree or Bureau Director of Mines in that law are interpreted as references to Presidential Decree No. 972 and the Energy Development Board.

If any provision of the Decree is declared unconstitutional, remaining provisions shall remain effective and unaffected.

All existing laws, orders, and regulations inconsistent with this Decree are repealed, revoked, modified, or amended accordingly.