Department Circular

Department Circular No. 2003-11-010


Providing For the Rules & Regulations Governing the Business of Retailing Liquid Petroleum Products

 

WHEREAS, R. A. 8479, otherwise known as the "Downstream Oil Industry Deregulation Act of 1998", applies to all persons or entities engaged in any and all activities of the domestic downstream oil industry and mandates the DOE to promote the entry of new industry participants;




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Department Circular No. 2003-10-009


Geothermal Safety and Health Code of Practice

 

STATEMENT OF AUTHORITY Pursuant to Rule 2, Section 8 of Department Circular No. 2000-02-001, otherwise known as the “Revised Geothermal Safety and Health Rules and Regulations”, and in order to ensure adequate safety and protection against hazards to health, life and property as well as pollution of air, land and water from geothermal operations, the following geothermal safety and health code of practice are hereby promulgated:

GENERAL PROVISIONS SECTION I. SAFETY AND HEALTH POLICY A. SAFETY AND HEALTH POLICY STATEMENT 1. Providing a safe workplace while protecting the health of the workers must be the principal responsibility of the geothermal operator. To achieve this, safety and health concerns must be thoroughly integrated in the geothermal operator's management policy.




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Department Cicular No. 2003-07-008


Creation and Establishment of A Project Management Office to Manage the Implementation of the World Bank Financed Rural Power Project

 

WHEREAS, the Department of Energy (DOE), in pursuance of its mandate under the "Electric Power Industry Reform Act of 2001" or "EPIW has envisioned the achievement of country's total electrification; WHEREAS, rural power development is a flagship program of the DOE that would provide support for the implementation of reforms and priority investments critical for achieving the goals in a sustainable manner in partnership with the private sector;

WHEREAS, on 27 February 2003, the NEDA﷓Investment Coordination Committee Cabinet Committee (ICC﷓CC) has approved the proposed Rural Power Project (the Project) to be financed by the World Bank through its Adaptable Program Lending (APL) Facility with co﷓financing from the Global Environment Facility (GEF) in support of the country's total electrification program;

WHEREAS, the Project provides a programmatic structure, piloting new strategies and business models in implementing rural electrification program consistent with EPIRA;

WHEREAS, there is the need to create and establish an adequate and full﷓time Project Management Office (PMO) to ensure the implementation and monitoring of the investment and capacity﷓building components of the Project is done in a timely, organized, and efficient manner;

WHEREAS, one of the conditions in the loan consideration by the NEDA﷓ICC is that the DOE shall ensure that the establishment of such PMO shall not lead to the creation of new positions, given the rationalization program of the Department of. Budget and Management, NOW, THEREFORE, the DOE hereby creates and establishes the Project Management Office for the effective management of the Rural Power Project, and ensure the integration and consistency with the rest of the rural electrification programs and activities of the Government through the Department of Energy.




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Department Circular No. 2003-06-007


"Rules and Regulations Implementing Republic Act 8479, Downstream Oil Industry Deregulation Act of 1998," As Amended

 

Pursuant to chapter VII, Section 23 of Republic Act No. 8479, otherwise known as the "Downstream Oil Industry Deregulation Act Of 1998," Section 14 (paragraph) c of Department Circular nNo. 98-03-004, as amended by Department Circular No. 2002-05-001, is hereby further amended to read as follows:




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Department Circular No. 2003-05-006


Amending Certain Provisions of Petroleum Board Circular Nos. 15 And 2, Series of 1975 and 1976, Respectively, Providing Guidelines to the Financial and Technical Capabilities of A Viable Petroleum Exploration and Production Company

 

WHEREAS, the former Petroleum Board now Department of Energy issued Circular Nos. 15 and 2, Series of 1975 and 1976, respectively, providing guidelines related primarily to the financial and technical. Capabilities of a viable petroleum exploration and production company.

WHEREAS, it is necessary to amend certain provisions of the said Circular to make it attuned to the conditions under which it is being implemented and considering that petroleum exploration and production is highly capital intensive. NOW, THEREFORE, the DEPARTMENT hereby adopts and promulgates the following amendments to certain provisions of Petroleum Board Circular Nos. 15 and 2, Series of 1975 and 1976, respectively:

Section 1. 3RD AND 5TH Paragraphs of Circular No. 15 is hereby amended to read as follows: Considering that establishing the capitalized value of a company differs in different countries, a company who will engage in onshore exploration and offshore exploration ventures may be considered as a viable exploration company if the DEPARTMENT is satisfied in the adequacy of its financial resources. Likewise, the exploration company should show that it has sufficient resources to meet future requirements.

Section 2. Paragraph a of Circular No. 2 on the Financial Qualification is hereby amended to read as follows: a) Financial Qualification A company to be financially qualified to enter into a service contract must have a minimum working capital equivalent to one hundred percent (100%) of the cost of the firm Work Obligation on the area being applied for. In case of consortium, to qualify, each member's working capital shall be pro-rata based on its participating interest in the service contract. "Working Capital," in the concept of the guidelines, refers to the company's net liquid assets (Liquid Assets less Current Liabilities) consisting primarily of cash, temporary investments, (marketable securities), short-term receivables and deposits, which are free for investment in petroleum operation. It is understood that the available working capital should be net of the financial commitment from other existing service contracts. In addition, each consortium member should have an acid-test ratio of 1.5:1 and a debt/equity ratio of 3:1.

Section 3. Additional Provisions are hereby inserted between paragraph (C) and the Penultimate paragraph of Petroleum Board Circular No. 2, series of 1976, to read As follows: a) In case of a newly organized subsidiary company which is willing to engage in petroleum operations but its capital is not sufficient to meet the minimum requirement, its parent company shall be required to submit its financial statements and provide support to a subsidiary through a parent guarantee. b) Past exploration expenditures incurred by a contractor shall be included in the new service contract as an operating expense and cost recoverable in case of production subject to the validation of the DEPARTMENT. Such expense however, shall be limited to the past expense relative to the same area subject of the application and participating interest of the contractor. In the event, that the area covered by prior service contract is bigger than the area applied for, such expense shall be pro-rated to effect the actual expenses to be carried in the new service contract.

Section 4. Repealing Clause All other circulars, rules and regulations inconsistent with this Department Circular are hereby modified, amended and repealed accordingly.

Section 5. Effectivity This Circular shall take effect fifteen (15) days following its publication in a newspaper of general circulation. Issued this 19th day of May 2003 in Fort Bonifacio, Taguig, Metro Manila. (Sgd.) VINCENT S. PEREZ Secretary

 



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Department Cicular No. 2003-05-005


Procedures for Contract Area Definition and Public Contracting Rounds in Petroleum Prospective Areas

 

WHEREAS, Section 5 of Presidential Decree No. 87, otherwise known as the "Oil Exploration and Development Act of 1972", as amended, provides that "every contract herein authorized shall, subject to the approval of the President, be executed by the Petroleum Board (now Department of Energy) created in this Act, after due public notice, pre qualification and public bidding or concluded through negotiations";

WHEREAS, the current practice of the Department of Energy (DOE) is to grant all petroleum Geophysical Survey and Exploration Contracts (GSEC) and Service Contracts (SC) through negotiations on a "first come, first served basis";

WHEREAS, the DOE desires to change the current practice of granting contract areas freely defined by the Contractor by offering areas predefined by the DOE based on a blocking reference system to facilitate the establishment of the most effective exploration strategy and allow the DOE to evaluate the market value or true value of the acreage that is being offered;

WHEREAS, in order to promote the government's petroleum exploration and development program, there is a need to attract both local and foreign oil industry investments through competitive public contracting rounds in petroleum prospective areas. NOW, THEREFORE, in consideration of the aforementioned premises, the following procedures shall govern the competitive system for awarding petroleum exploration, development and production service contracts:




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Department Circular No. 2003-04-004


Creating An Expanded Rural Electrification (ER) Team To Manage The Implementation Of Rural And Missionary Electrification Program For The Purpose Of Achieving The Country’s Total Electrification

 

WHEREAS, the Department of Energy (DOE), in pursuance of the policy of the State to ensure and accelerate the total electrification of the country, has targeted the attainment of 100 percent barangay electrification level by 2006;

WHEREAS, the DOE and Department of Finance (DOF) have jointly issued the Letter of Sector Development Program reiterating its commitment to total barangay electrification by 2006 as well as to energize 90 percent of total potential households by 2017;

WHEREAS, the DOE, in compliance with Rule 13 of the Implementing Rules and Regulations of Republic Act No. 9136 or the "Electric Power Industry Reform Act of 2001" or "EPIRA," has developed a Missionary Electrification Development Plan (MEDP) that embodies the framework on how the government and the private sector can collaborate for the effective leveraging of limited public sector resources;




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Department Circular No. 2003-03-003


Transmission Development Plan

 

WHEREAS, Republic Act 9136, the Electric Power Industry Reform Act of 2001 (EPIRA) requires the promulgation of a Transmission Development Plan (TDP). WHEREAS, Section 4 (bbb) of the EPIRA states that the TDP "refers to the program for managing the transmission system through efficient planning for the expansion, upgrading, rehabilitation, repair and maintenance, to be formulated by DOE and implemented by the TRANSCO pursuant to this Act".

WHEREAS, Section 9(f) of the EPIRA designates the National Transmission corporation (TRANSCO) to prepare such TDP and submit the same to the Department of Energy (DOE) for integration to the Power Development Plan and the Philippine Energy Plan.

WHEREAS, Under Section 9 (c) of the EPIRA, it is the responsibility of the TRANSCO to ensure and maintain the reliability, adequacy, security, stability and integrity of the nationwide electrical grid in accordance with the performance standards for the operation and maintenance of the grid as set forth in the Grid Code. WHEREAS, TRANSCO has endorsed the TDP to DOE for evaluation and approval on March 25, 2003.

WHEREAS,TRANSCO shall seek the support of the Energy Regulatory Commission for the individual capital investment plan within the broad context of the TDP. NOW THEREFORE, the DOE hereby adopts and approves the Transmission Development Plan of 2003. Done this 28th of March 2003, Fort Bonifacio, Metro Manila. (Sgd.) VINCENT S PEREZ, JR Secretary




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Department Circular No. 2003-03-002


Providing For the Relaxation of the Minimum Inventory Requirements of All Oil Companies and Bulk Suppliers Operating In the Country

 

WHEREAS, under the Downstream Oil Industry Deregulation Act of 1998 (RA 8479), in relation to the Department of Energy Act of 1992 (RA 7638), the Secretary of Energy is authorized to exercise such powers concomitant with the policy of ensuring continuous, adequate and stable supply of energy, in respect of the conservation, stockpiling and storage of energy resources;

WHEREAS, Executive Order No.134 requires the Oil Companies and Bulk Suppliers to maintain a sufficient minimum inventory of petroleum, for purposes of ensuring a continuous, adequate and stable supply of Petroleum. Crude Oil and Products, in cases where domestic and international events threaten or restrict the supply of Petroleum Crude Oil and Products to the Philippines such as, but not limited to, terrorist attacks, armed conflict in the Middle East and in other regions from which the Philippines draws or transits its supply of Petroleum Crude Oil and Products, and other similar events;




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Department Circular No. 2003-01-001


Guidelines Implementing the Minimum Inventory Requirements of Oil Companies and Bulk Suppliers As Provided Under EO 134

 

Pursuant to Executive Order No. 134 issued by the President of the Republic of the Philippines on 14 October 2002, Republic Act No. 7638, otherwise known as an "Act Creating the Department of Energy" and Republic Act No. 8479, otherwise known as the "Downstream Oil Industry Deregulation Act of 1998", the Department of Energy hereby adopts the following guidelines to implement the minimum inventory requirement of all Oil Companies and Bulk Suppliers operating in the country, to ensure a continuous, adequate and stable supply of Petroleum Crude Oil and Products in cases where domestic and international events threaten or restrict the supply of Petroleum Crude Oil and Products to the Philippines such as, but not limited to, terrorist attacks, armed conflict in the Middle East and in other regions from which the Philippines draws or transits its supply of Petroleum Crude Oil and Products, and other similar events.

 

 

 

 




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