Article 57p. 57

NATURAL RESOURCES AND ENVIRONMENTAL LAWS STATUTES and IMPLEMENTING RULES AND REGULATIONS

production

be

developed by granting incentives to

prospective coal users to convert their facilities for coal

utilization;

WHEREAS, to realize the above, it is necessary to amend

and/or supplement existing legislation relating to coal;

WHEREAS, Article XVII, Section 12 of the Constitution of

the Philippines provides in part that when the National

interest so requires the incumbent President of the

Philippines or the interim Prime Minister may review all

contracts,

concessions,

permits

or

other

forms

or

privileges for the exploration, development, exploitation

or utilization of natural resources entered into, granted,

issued

or

acquired

before

the

ratification

of

the

Constitution;

NOW, THEREFORE, I, FERDINAND E. MARCOS, by virtue

of the powers vested in me by the Constitution of the

Philippines, do hereby decree and declare as part of the

law of the land the following:

Section 1. Short Title. This Act shall be known and may be

cited as "The Coal Development Act of 1976."

Section 2. Declaration of Policy. It is hereby declared to

be the policy of the state to immediately accelerate the

exploration, development, exploitation production and

utilization

of

the

country's

coal

resources.

A

coal

development program is therefore promulgated and

established by this Decree.

Section 3. Coal Development Program. The country shall

be

divided

into

coal

regions

and

exploration

and

exploitation

programs

shall

be

instituted

and

implemented pursuant to this Decree.

These programs shall be geared towards the promotion

and

development

of

the

necessary

technical

and

financial capability to undertake a work program to

effectively explore exploit coal resources.

In recognition, however, of the social constraints that

may be encountered in effecting the establishment of

coal units in regions where there is high concentration of

small coal miners, a special coal program shall be

formulated and implemented in coordination with the

appropriate government agency/agencies to meet the

particular needs of such regions.

Section 4. Government to Undertake Coal Exploration

Development and Production. The Government, through

the

Energy

Development

Board,

its

successors

or

assigns, shall undertake by itself the active exploration,

development and production of coal resources. It may

also

execute

coal

operating

contracts

as

hereafter

defined. The active exploration and exploitation of coal

resources by the Government or through coal operating

contracts may cover public lands, any unreserved or

unappropriated coal bearing lands, claims located and

recorded by private parties areas covered by valid and

subsisting coal revocable permits, coal leases and other

existing

rights

granted by the Government for the

exploration and exploitation of coal lands, government

mineral reservations, coal areas/mines whose leases or

permits are presently owned or operated or held by

government-owned or controlled corporations and coal

mineable

areas

operated

or

held

by

government

agencies.

Section 5. Blocking System. The Energy Development

Board shall establish coal regions delimiting its extent

and

boundaries

after

taking

into consideration the

various coal bearing lands of the Philippines. Each coal

region

shall

be

divided

into

meridional

blocks

or

quadrangles of two minutes (2') of latitude and one and

one-half

minutes

(1-1/2)

of

longtitude,

each

block

containing an area of one thousand (1,000) hectares,

more or less, the boundaries thereof to coincide with the

full two minutes and one and one-half minutes of

latitude

and

longtitude,

respectively,

based

on

the

Philippine Coast and Geodetic Survey Map, scale of

1:50,000.

Section 6. Coal Contract Area. In conformity with the

blocking

system

herein

established,

the

Energy

Development Board shall determine in each coal region

what areas, are available for coal operating contracts. In

opening such contract areas, the Energy Development

Board may resort to either of the following alternative

procedures:

(a) By offering an area or areas for bids, specifying the

minimum requirements and conditions in accordance

with this Decree: or

(b) By negotiating with a qualified party for a coal

operating contract under the terms and conditions

provided in this Decree.

No person shall be entitled to more than fifteen (15)

blocks of coal lands in any one coal region.

Section 7. Existing Permitees/Leaseholders. All valid and

subsisting holders of coal revocable permits, coal leases

and other existing rights granted by the government for

the exploration and exploitation of coal lands or the

operators thereof duly approved by the appropriate

government agency, shall be given preference in the

grant of coal operating contract over the area covered by

their permits, leases or other rights subjects to their

compliance

with

the

following

conditions

and

guidelines:

(a) Those whose areas fall within a block as described in

Section

5

hereof

shall

organize

or

consolidate

themselves into a coal unit, singly or jointly with valid

and subsisting holders of coal revocable permits, coal

leases

and

other

existing

coal

rights

or

the

duly

approved

operator

thereof,

of

contiguous

blocks

provided that a coal unit shall not be entitled to more

than fifteen (15) blocks of coal lands in any coal region.

(b) Consolidation of areas into coal unit which shall

require approval by the Energy Development Board

must be completed within a period of six (6) months

from the effectivity of this Decree.

(c) In order to qualify for consolidation into coal units,

permitees,

leaseholders

or

operators

must

have

complied

with

the

requirements

of

their

existing

permits, leases and/or rights as defined under existing

laws, rules and regulations.

(d) Members of the coal unit shall agree on the form,

terms

and

extent

of

participation

of

its

individual

members.

All

holders

of

valid

and

subsisting

coal

revocable permits, coal leases and other existing rights

granted

by

the

government

for

the

exploration,

development and exploitation of coal lands shall be

given percentage interest in the unit or payments out of

production under such terms and conditions as may be

agreed by the members of the unit and approved by the

Energy Development Board.

(e) In order to give holders of valid and subsisting coal

revocable permits, coal leases and other existing rights

granted by the government for the exploration and

exploitation of coal lands or the operators thereof duly

approved

by

the

appropriate

government

agency,

sufficient time to upgrade their financial and technical

capabilities to develop a viable work program to be

embodied in a coal operating contract, the deadline for

entering and concluding a duly executed coal operating

contract is extended from July 27, 1977 to January 27,

1978; Provided, that the extension shall apply only to

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