Energy circular kickstarts coal, petroleum investments in BARMM

An Intergovernmental Energy Board (IEB) Circular has been jointly inked by the Department of Energy (DOE) and the Ministry of Environment, Natural Resources, and Energy (MENRE) to kickstart investments in coal, and petroleum exploration and development in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM).

The IEB Circular on Joint Award of Petroleum Service Contracts (PSCs) and Coal Operating Contracts (COCs) in the BARMM was signed by Energy Sec. Raphael P.M. Lotilla and Minister Akmad A. Brahim, MENRE at the Malacanang
Palace on Wednesday, July 06, witnessed by President Ferdinand R. Marcos Jr.

The circular serves as the enabling policy for the joint award of petroleum service contracts (PSCs) and coal operating contracts (COCs) for resource-endowed prospects within the BARMM-covered jurisdictions.

In a media statement, the DOE qualified that “the IEB Circular operationalizes the provision in Section 10, Article XIII of Republic Act No. 11054 or the Organic Law for the Bangsamoro Autonomous Region to jointly grant rights, privileges, and concessions for the exploration, development, and utilization of uranium and fossil fuels such as petroleum, natural gas, and coal within the territorial jurisdiction of the Bangsamoro.”

The circular further outlines the requisite requirements, procedures, and standards for companies seeking to apply for and operate PSCs and COCs and ensure that exploration and development activities will adhere to stringent rules and regulations, and best practices.

For petroleum contracts, in particular, applicants could either be local or foreign companies — including consortia or joint ventures; while for coal exploration, applicant-firms are required to observe the nationality requirement for the majority stake of 60-percent.

Upon the Circular’s implementation, the energy department declared that this will “kickstart the application process for PSCs and COCs in the BARMM,” which covers the provinces of Basilan, Lanao del Sur, Maguindanao del Norte, Maguindanao del Sur, Sulu and Tawi-tawi.

In his speech during the signing of the IEB Circular, Energy Secretary Raphael P.M. Lotilla noted that “this is an important step towards progress in Mindanao, and possibly the establishment of another energy resource capital in the Philippines.”
Several areas in the BARMM are touted to be resource-rich, primarily for coal exploration ventures; while gas potential is also eyed along Liguasan Marsh, a southern island in the Mindanao river basin which partly straddles Maguindanao.

Beyond the extraction and prospective commercial development of indigenous coal and petroleum reserves, Lotilla apprised the President that “next on our joint priority is the upgrading of electricity infrastructure in the BARMM provinces.”
The energy chief similarly conveyed to the Chief Executive that in the “energy diplomacy” being advanced by the Philippine government with the Middle East, “the energy needs of the BARMM will form part of your agenda.”

“The successful establishment of this IEB Circular holds immense potential. It will not only contribute to the energy security of the country but also unlock vast opportunities for economic growth in the Bangsamoro Autonomous Region” the energy chief stressed.