By Joel San Juan
Business Mirror
June 9, 2008
SAYING that the case was prematurely filed, the Court of Appeals (CA) has dismissed the petition filed by a group of taxpayers seeking to declare as unconstitutional Executive Order (EO) 683 allocating the P6-billion share of Palawan, from the Camago-Malampaya oil and natural gas project as part of the pork barrel of the governor and the two congressmen of the province.
In a seven-page decision penned by Associate Justice Rebecca de Guia-Salvador, the CA’s Eleventh Division also noted that the petition filed by Bishop Pedro Dulay Arigo, Cesar Sarino, Jose Antonio Socrates and lawyer Harry Roque is anchored on the same facts and issues raised in GR 170867, a petition for review pending before the Supreme Court.
The said petition for review seeks the reversal of the December 16, 2005, decision rendered by Branch 95 of the Regional Trial Court in Puerto Princesa, Palawan, declaring that the province of Palawan is entitled to 40-percent share of the national wealth, computed based on revenues generated from the Camago-Malampaya Natural Gas Project since October 16, 2001.
“Because the issue which inextricably links the instant petition and GR 170867 is whether the Camago-Malampaya natural gas reservoir is within the territorial jurisdiction of Palawan, forms part of the national territory of the Philippines, it would be premature for the court to rule on this case when GR 170867 is still up for adjudication before the Supreme Court,” the CA said.
Furthermore, the appellate court explained that the interim undertaking between the national government and the province of Palawan to grant the latter a 50-percent share of the disputed 40 percent from the proceeds of the Camago-Malampaya project under the terms of the Provisional Implementation Agreement (PIA) is dependent on the final resolution of GR 170867.
A ruling on the issue, according to the CA, would also be tantamount to a “collateral adjudication” of the archipelagic baseline considering the ongoing efforts of both the Legislative and Executive departments to arrive at a common position in redefining the country’s baseline in the light of the United Nations Convention on the Law of the Sea.
“The task of defining the baseline involves policy determination, accordingly, ample opportunity must be accorded the Legislative and Executive departments to forge a policy concensus, and to implement them before the courts may intervene under the expanded concept of judicial power in Section 1, Article 8 of the Constitution,” the CA stressed.
The CA also dismissed the petition owing to the failure of the petitioners to attach relevant pleadings and other important documents to support the allegations of the petitions, such as a copy of the petition for review on certiorari in GR 170867, the PIA, and Service Contract (SC) 38.
In their petition, the petitioners asked the appellate court to nullify EO 683, titled “Authorizing the Use of Fees, Revenues and Receipts from Service Contract 38 for the Implementation of Development Projects for the People of Palawan” issued by President Arroyo on December 1, 2007.
Named respondents in the case were Executive Secretary Eduardo Ermita, Energy Secretary Angelo Reyes, Finance Secretary Margarito Teves, Budget Secretary Rolando Andaya, Palawan Gov. Joel Reyes, Kabalikat ng Malayang Pilipino Rep. Antonio Alvarez of Palawan, Nationalist People’s Coalition Rep. Abraham Mitra of Palawan and Rafael del Pilar, president and chief executive of the Philippine National Oil Co.,-Exploration Corp.
Records showed that the Department of Energy entered into a service contract with Shell Philippines Exploration BV and Occidental Philippines on December 11, 1990, for the exclusive contract of petroleum operations in the area.
The exploration led to the drilling of the Camago-Malampaya natural-gas reservoir located about 80 kilometers from the coastline of Palawan in the South China Sea with projected revenues of approximately $8 billion to $10 billion for the government.
But a dispute arose between the local and national government over the share of proceeds for the gas project.
The Palawan government had asserted its claim over a 40-percent share of the proceeds, based on the 1991 Local Government Code.
But the national government said Palawan’s claim was unfounded because the natural-gas reservoir is approximately 80 km from the coastline of Palawan and is thus outside its territorial jurisdiction.
Negotiations ensued resulting in the issuance of EO 683 with a PIA that would allow 50 percent of the disputed 40 percent in the net government share in the proceeds of SC 38 to be utilized for development projects in the province.
The suit seeks to prohibit the disbursement following the EO and urges the appellate court to “declare it illegal for being a violation of the Local Government Code and the 1987 Constitution and made in grave abuse of discretion amounting to a lack of jurisdiction.”
“In EO 683, what the government wants to do really is a realignment of funds, which is a violation of the Constitution. For in usual budgeting procedures of Congress, the share from the national wealth is included in the appropriation for ‘allocation to local governments’ which is classified as a mandatory obligation of the national government to the local government and automatically released to the local government in accordance with Section 29 of Republic Act 7160, otherwise known as the Local Government Code,” the petitioners said.
The petitioners noted that the PIA illegally grants the governor and the representatives from Palawan’s two congressional districts a huge pork barrel, which is larger than the allocation of pork barrel for all members of the House of Representatives’ appropriations.
