Compiled from an official source version. Later amendments or repeals may not be reflected; the official text prevails.・Read the official text ↗
Bond for performance.
ART. 97. Bond for performance.—Prior to the issuance of a concession, except the Non-Exclusive Exploration Permit, the concessionaire shall post a bond in favor of the Government in the sum to be fixed by the Regulations and with surety or sureties satisfactory to the Secretary of Agriculture and Natural Resources, conditioned upon the faithful performance by the concessionaire of any or all of his obligations under the concession.
Share of private land owners.
ART. 98. Share of private land owners.—In case an Exploration or Exploitation Concession covers, in whole or in part, private lands title to which has been finally adjudicated by a court of competent jurisdiction, the exploration or exploitation tax due to the Government for the area of such private lands, shall be reduced by ten per cent of the same, which reduction shall be the landowner's share. In the case of lands title to which has not been finally adjudicated all the exploration and exploitation tax for said areas due to the Government shall be paid to the Collector of Internal Revenue or his duly authorized deputy, subject to the rule and regulations of the Bureau of Internal Revenue. In any case, the right of private owner to recover ten per cent share when and if his title shall have been finally adjudicated in his favor shall be respected and for such purpose the Government shall hold the same until such title has been so finally adjudicated.
National emergency measures.
ART. 99. National emergency measures.—Concession granted under this Act shall be subject to the rights of Government, in case of and during the period of war national emergency, to pass such lawful measures, as it may consider necessary, requisitioning for its use and/or restricting the sale or disposal of all products produced under the terms of the concessions and/or interfering with the free movement thereof, upon just compensation paid to the concessionaires.
Disposition of substances other than petroleum.
ART. 100. Disposition of substances other than petroleum.—In the event that substances other than petroleum as denned in article two, should occur naturally and be produced with petroleum, the exploitation concessionaire may separate such other substances at his own expense; Provided, That in the event that any such other substances be sold, the value thereof shall be taken into account in fixing the value of petroleum for the purpose of liquidating royalty in cash as provided in article sixty-eight: And provided, further, That if the Secretary of Agriculture and Natural Resources elects to receive; such other substances in kind the concessionaire shall, upon request of the Secretary of Agriculture and Natural Resources, separate and deliver to the Government such substances through the facilities of the concessionaire and at the expense of the Government.
Helium rights reserved.
ART. 101. Helium rights reserved.—The Government reserves the right to take all helium from any gas produced by the concessionaire and the right to erect, maintain, and operate on lands covered by the concession, all reduction works and other equipment necessary for the extraction helium. The Secretary of Agriculture and Natural Resources shall prescribe the necessary rules and regulation governing the delivery to the Government of gas containing helium for the extraction thereof.
Work obligations, taxes, royalties not changed.
ART. 102. Work obligations, taxes, royalties not changed.—Work obligations, special taxes and royalties which are fixed by the provisions of this Act or by concession for any of the kinds of concessions to which this Act relates, are considered as inherent on such concessions after they are granted, and shall not be increased during the life of the concession to which they apply; nor shall any other special taxes or levies be applied to such concessions, nor shall concessionaires under this Act be subject to any provincial, municipal, or other local taxes or levies; nor shall any sales tax be charged on any petroleum produced from the concession or portion thereof, manufactured by the concessionaire and used in the working of his concession. All such concessionaires, however, shall be subject to such taxes as are of general application, in addition to taxes and other levies specifically provided in this Act.
Customs duties.
ART. 103. Customs duties.—During the first five years following the granting of any concession, the concession-aire may import free of customs duty, all equipment, machinery, material, instruments, supplies and accessories. No exemption shall be allowed on goods imported by the concessionaire for his personal use or that of any others; nor for sale or for re-export; and if any goods on which exemption has been allowed be thus used or disposed of, the concessionaire is obliged to make a report to the Secretary of Agriculture and Natural Resources to that effect and to pay such import duty as is due.
No export tax to be imposed.
ART. 104. No export tax to be imposed.—No export tax shall be levied upon petroleum produced from concessions granted under this Act.
Compulsory collection.
ART. 105. Compulsory collection.—In the event of failure by a concessionaire to pay any tax or royalty due under the provisions of this Act within six months of the date upon which they are due, the Government may resort to compulsory collection under the provisions of applicable laws.
Inspection of operations and examination of books and accounts.
ART. 106. Inspection of operations and examination of books and accounts.—The Secretary of Agriculture and Natural Resources and the Director of Mines shall have authority to send their delegates or representatives to Aspect any operations of the concessionaire at all reasonable times and to examine all the books and accounts pertaining to operations or conditions related to payment of taxes and royalties under this Act, and to carry out any other inspections authorized by law. The concessionaire shall furnish to such delegates or representatives all technical and accounting data specified in the Regulations, and shall give them ample facilities and assistance to discharge their duties as such representatives and inspectors. For the purpose of enabling proper examination as provided for in this article, each concessionaire shall be obligated to retain within the country all original records or original carbon copies thereof which are essential for the purpose of determining the amount of taxes and royalties due to the Government, except as may be agreed upon between the Secretary of Agriculture and Natural Resources and the concessionaire.
Settlement of disputes by agreement.
ART. 107. Settlement of disputes by agreement.—For the purpose of settling or terminating any controversy arising out of the provisions of this Act, other than those arising out of conflict of applications, the Secretary of Agriculture and Natural Resources is authorized, to enter into agreement with any petroleum concessionaire, and in case of their failure to come to such an agreement, the Secretary of Agriculture and Natural Resources shall render his decision thereon, from which decision the concessionaire adversely affected thereby, may bring the matter to the court of competent jurisdiction within forty-five days from the date of his receipt of a copy of said decision. Failure to take such action within the said period, shall make such decision final and binding upon the concessionaire. Such agreement between the Secretary of Agriculture and Natural Resources and a concessionaire may be reached either with or without the intervention of arbitrators selected by the parties to the controversy.
ART. 108. Definition of "waste."—The term "waste" shall specifically include among other things the following: (a) The operation of any petroleum well or wells with an inefficient gas-oil ratio. (b) The drowning with water of any stratum or part thereof capable of producing oil or gas, or both oil and gas in paying quantities. (c) Permitting any natural gas well to burn wastefully. (d) Physical waste or loss incident to, or resulting from, drilling, equipping, locating, spacing, or operating well or wells as to reduce or tend to reduce the total ultimate recovery of crude petroleum oil or natural gas from any pool. (e) Waste or loss incident to, or resulting from, the unnecessary, inefficient, excessive or improper use of the Reservoir energy, including the gas energy or water drive, in any well or pool. (f) Surface waste or surface loss, including the storage either permanent or temporary of crude petroleum or the placing of any product thereof, in open pits or earthen storage, and all other forms of surface waste or surface loss, including unnecessary or excessive surface losses, or destruction without beneficial use, either of crude petroleum or of natural gas. (g) The production of crude petroleum or natural gas in excess of transportation or market facilities or reasonable market demand.
Prevention of waste.
ART. 109. Prevention of waste.—All concessionaires, operators, contractors, or drillers, pipe line companies, petroleum refining companies, or gas distributing companies, drilling for or producing petroleum or petroleum products, or piping petroleum for any purpose, shall use every possible precaution in accordance with the most improved methods to stop and prevent waste of petroleum or natural gas in drilling and producing operations, storage or in piping or distributing, and shall not wastefully utilize petroleum or natural gas or allow same to leak or escape from natural reservoirs, wells, tanks, containers, or pipes.
Rules and regulations regarding conservation of petroleum.
ART. 110. Rules and regulations regarding conservation of petroleum.—Rules and regulations may be issued which shall require concessionaires to utilize in their exploration and exploitation operations the latest and most improved methods and devices to prevent waste in petroleum as well as to prevent oil, oil-field brine or other oil-field contamination from causing pollution or otherwise damaging streams, surface or underground water supply, and valuable mineral deposits. The Secretary of Agriculture and Natural Resources may also issue orders which shall control the rate of production from any well in the interest of conservation of the petroleum resources.
ART. 111. Applications filed prior to approval of this Act—Applications for geological exploration, petroleum drilling lease, concession, or contract of service, presented prior to the promulgation of this Act to the Philippine Oil Commission, the Secretary of Agriculture and Natural Resources, or the Director of Mines, which applications have not been granted, or if granted, had already expired, or are no longer in effect at the time this Act becomes effective shall remain without effect.
ART. 112. Transfer and assignment—Holders of concessions under this Act shall not, without previous written approval of the Secretary of Agriculture and Natural Resources, transfer or assign in whole or in part, their rights on their concessions; provided that no such transfer or assignment shall be made to a person who is not qualified to acquire or hold concession under this Act, or who shall hold a total area under exploration or exploitation concessions, including that being transferred or assigned to him, of more than the maximum areas allowed under this Act.
Partial invalidity.
ART. 113. Partial invalidity.—If any clause, sentence, provision or article of this Act should for any reason be held to be invalid or unconstitutional, it shall not affect in anywise the remaining parts of this Act and such remaining parts shall remain in full force and effect.
Repeal of laws, rules and regulations.
ART. 114. Repeal of laws, rules and regulations.—ALL acts, laws, rules and regulations inconsistent with any of the provisions of this Act are hereby repealed.
Effective date.
ART. 115. Effective date.—This Act shall take effect upon its approval. Approved, June 18, 1949.
Provisions on this page are reproduced verbatim from official open data. See the attribution line.
Source: Supreme Court E-Library, Republic of the Philippines. Philippine laws are public documents (works of the government).