Under P.D. 87, otherwise known as "The Oil Exploration and Development Act of 1972", the following incentives may be availed of by prospective service contractors in the natural gas industry, to wit:

• Service fee of up to 40.0 percent of net production income;
  
• Cost reimbursement of up to 70.0 percent of gross production income;
  
• 7.5 percent participation incentive allowance for local investors; and,
  
• Tax and duty-free importation of materials and equipment.

Under Book I of E.O. 226 or the Omnibus Investments Code of 1987, the following incentives may be availed of by the operators of power generation projects utilizing natural gas, including those under the NPC privatization plan:

• Income tax holiday;
  
• Minimum tax and duty of 3.0 percent and value-added tax on imported capital equipment;
  
• Tax credit on domestic capital equipment;
  
• Exemption from contractor's tax;
  
• Unrestricted use of consigned equipment;
  
• Exemption from taxes and duties on imported spare parts; and,
  
• Such other applicable incentives under Article 39 of E.O. No. 226.

Oil

Section 9, Chapter II of R.A. 8479, or "An Act Deregulating The Downstream Oil Industry, and For Other Purposes" provides that persons with new investments as determined by the DOE and registered with the BOI in refining, storage, marketing and distribution of petroleum products shall be extended the same incentives granted to BOI-registered enterprises engaged in a preferred area of investments pursuant to E.O. 226, or the Omnibus Investments Code of 1987, and the 2006 Investment Priorities Plan, thus:

• Income tax holiday;
  
• Minimum tax and duty of 3.0 percent and value-added tax on imported capital equipment;
  
• Tax credit on domestic capital equipment;
  
• Exemption from contractor's tax;
  
• Unrestricted use of consigned equipment;
  
• Exemption from taxes and duties on imported spare parts; and,
  
• Such other applicable incentives under Article 39 of E.O. No. 226.