Article 68p. 68

NATURAL RESOURCES AND ENVIRONMENTAL LAWS STATUTES and IMPLEMENTING RULES AND REGULATIONS

adjoining

concessions,

settlement

of

conflict,

or

geographical

or

geological

features

that

render

it

impractical

to

conform

with

such

requirements. (Amendments to R.A. No. 387 (Petroleum

Act of 1949), Republic Act No. 3098, [June 17, 1961])

ARTICLE 44.Maximum exploration area a person may

acquire. — No person shall be entitled to more than five

hundred thousand hectares of exploration areas in any

one petroleum region established in accordance with

the provisions of article twelve of this Act, nor more than

one

million

hectares

in

the

whole territory of the

Philippines.

ARTICLE

45.Rights

conveyed

under

Exploration

Concession. — The Exploration Concession conveys upon

the concessionaire, his heirs and assigns, from the date

of the granting of the concession, and during the

exploration

period

and

any

extension

thereof,

the

exclusive right to explore the block granted, to do

geological and geophysical work, to open test pits, to

conduct drilling operations, and to do such other work

related to exploration.

ARTICLE 46.Term of exploration concession. — The initial

term of an exploration concession shall be not more than

four

years

counted

from

the

date

of its issuance:

Provided,

however,

That

if

the

concessionaire

has

complied

with

the

provisions

of

this

Act

and

the

regulations

and

with

the

terms

and

conditions

contained

in

the

contract

of

concession,

the

concessionaire is entitled to the grant of an extension of

the same for a term of three years, for its entire area or

for

any

part

thereof,

upon

application

of

the

concessionaire

made

prior to the expiration of the

original term. If during the said first extension, the

concessionaire has also complied with the provisions of

this

Act

and

the

regulations

and

the

terms

and

conditions contained in the contract of concession, upon

application of the concessionaire made prior to the

expiration

of the first extension, the concessionaire

likewise is entitled to a further extension of the said

concession for its entire area or for any part thereof, for

another term of three years.

The extension shall be granted under the same terms

and

conditions

as

those

contained

in

the

original

concession, subject, however, to the provisions of Articles

forty-seven and forty-nine of this Act.

No further renewal shall be allowed to any exploration

concessionaire at the end of the second extension.

(Amendments to R.A. No. 387 (Petroleum Act of 1949),

Republic Act No. 3098, [June 17, 1961])

ARTICLE

47.Exploration

work

obligations.

—

At

the

beginning of each calendar year during the life of the

concession,

the

concessionaire

shall

submit

to

the

Director of Mines, a program of exploration work to be

undertaken by the concessionaire with his concession

during that year.

He is obligated to spend in the direct prosecution of

exploration

work

within

his

concession,

such

as

topographic, or geological reconnaissance; mapping or

cross sectioning, geophysical surveys by magnetometer,

gravimeter or seismograph; core or exploratory drilling;

or any combination of the said work, the following

amounts:

Initial term:

First year — Not less than fifty centavos per hectare per

year, or fraction thereof.

Second year — Not less than one peso per hectare per

year, or fraction thereof.

Third year — Not less than one peso and fifty centavos

per hectare per year, or fraction thereof.

Fourth year — Not less than two pesos per hectare per

year, or fraction thereof.

First extension:

Fifth to seventh year — Not less than two pesos and fifty

centavos per hectare per year, or fraction thereof.

Second extension:

Eight to tenth year — Not less than three pesos per

hectare per year, or fraction thereof.

The cost of delivered materials or equipment used in the

exploration

work

shall

be

considered

as

proper

expenditures for such work. The concessionaire shall

give satisfactory evidence to the Government of such

expenditures in accordance with the Regulations.

Any amount actually spent for exploration work in excess

of the minimum amount required for any year or years

may be carried forward and credited to exploration work

obligations required for the succeeding years during the

existence of the concession.

For

failure

to

comply

with

the

minimum

work

obligations in any one year as herein above stipulated,

the concessionaire shall pay to the Government the

difference between the minimum amount required and

that actually spent for any year. Continued failure to

perform the necessary exploration work within the area

covered by the concession shall. In addition to the above

penalty, result in the cancellation of the concession as

provided for in this Act.

In order to guarantee faithful compliance with the

required exploration work, a bond of sufficient amount

to be fixed by the Regulation, shall be posted by the

concessionaire.

[ SECTION

18

of

RA

No

3098 .Reduction

and/or

moratorium on exploration work obligations and annual

exploration taxes. — Notwithstanding the provisions of

Article forty-seven of the Petroleum Act of 1949, the

minimum amount of work obligations therein required

to be spent by a petroleum exploration concessionaire in

his concession is hereby reduced by fifty per centum for

two

consecutive concession years starting with the

current concession year when this Act takes effect:

Provided,

That

when

circumstances

warrant,

the

Secretary of Agriculture and Natural Resources upon

recommendation by the Director of Mines, may extend

this period of two years for another period of two years:

Provided, further, That upon previous approval by the

Secretary

of

Agriculture

and

Natural

Resources,

as

recommended by the Director of Mines, said reduced

amount work obligation required to be spent for any of

the said two concession years may be spent in either of

said two concession years. cdtai

The Secretary of Agriculture and Natural Resources,

upon recommendation of the Director of Mines, may

give holders of petroleum exploration concession where

the provisions of the Petroleum Act, the regulation and

the terms and conditions of the concession contract

have been complied with for two or more concession

years and where the progress of exploration is such that

exploration

drilling

is

the

next

logical

step

in the

operation in accordance with good petroleum field

practice,

as

indicated

by

technical

reports

duly

submitted

to

the

Director

of

Mines

showing

that

adequate geological field work was performed and

delineating at least a favorable structure with favorable

lighology

and

with

satisfactory

paleontological

correlations of surface and possibly subsurface rock

© 2018 Compiled by RGL

68 of 244