SIXTEENTH CONGRESS OF THE REPUBLIC ) 
~1.m?ltl' 
OF THE PHILIPPINES 
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IJ!lH,," .f. til' ;<, .. "Io<q 
First Regular Session 
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SENATE 
'13 
AUG -8 P 2 :58 
S. B. No. 1259 
RECTI \":1) ny: 
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Introduced by Senator Maria Lourdes Nancy S. Binay 
EXPLANATORY NOTE 
Several years have passed since the advent of the pipeline leak involving West Tower 
Condominium that was affected by the pipeline leak, and First Philippine Industrial 
Corporation, which owns and operates the Batangas-Manila pipeline. However, up to this 
time, there is no single governing body that has a clear and substantial jurisdiction over said 
pipeline and other pipelines in terms of regulation as to safety, specification and overall 
.operation. 
Due to the closure of the Batangas-Manila pipeline, the efficient and reliable supply of white 
oil products (gasoline, diesel, kerosene and jet fuel) to Metro Manila and nearby provinces 
were affected. The said pipeline approximately supplies 30-40% of the oil supply in the 
Pandacan Terminal. 
To address the need of a single governing body that will regulate, monitor and oversee the 
operations of petroleum pipelines this bill seeks to enhance and increase the jurisdiction of 
the Department of Energy (DOE) to include the foregoing. Also, this bill is in furtherance of 
the exercise of DOE's mandate to secure a safe and adequate supply of oil as well as to 
establish a Petroleum Pipeline Code that will serve as basis for the regulation, monitoring and 
overseeing operations of petroleum pipelines in the country. 
In view of the foregoing, the passage of this bill is earnestly recommended. 
O~RDEs'NANCY S. BINA Y 
Senator 
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SIXTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
) 
'sPtt<ttr 
U!)If,;, of til' :i-,,, ,tor. 
First Regular Session 
) 
SENATE 
"13 
AUG -8 P 2 :58 
S. B. No.1259 
Introduced by Senator Maria Lourdes Nancy S. BinayKFX'U '.U} BY:+ 
AN ACT TO STRENGTHEN THE JURISDICTION AND POWER or THE 
DEPARTMENT OF ENERGY OVER PETROLEUM PIPELINE OPERATIONS AND FOR 
THIS PURPOSE PROVIDE A PETROLEUM PIPELINE CODE TO PRESCRIBE 
STANDARDS FOR THE DESIGN. CONSTRUCTION, OPERATION AND 
MAINTENANCE AND ABANDONMENT OF LIQUID PETROLEUM PIPELINES AND. 
APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
CHAPTER I 
GENERAL PROVISIONS 
SECTION 1. Short Title, This Act shall be known as the "."Philippine Pipeline Act oj' 
20J3~:!!, 
SECTION 2. Declaration of Policy, It is hereby declared the policy of the State to: 
a) Promote transportation of liquid petroleum products through pipelines as a safe and 
efficient way of transporting liquid petroleum products; 
b) Provide for basic safety rules in petroleum pipeline operations and enhance reliability 
in the transportation of oil and liquid petroleum products by pipeline in the country; 
c) To encourage the inflow of private capital to encourage the use and development of 
petroleum pipelines; and 
d) To protect the public interest by ensuring the unhampered use of pipelines as a mode 
of tral1spqrting petroleum, especially to urban areas, 
SECTION 3. Scope and ApplicatiOn. Except as otherwise provided herein, this Act shall 
apply to all existing and future petroleum pipelines in the country. 
SECTION 4. Definition afTerms. 
a) Act _ shall refer to the Philippine Pipeline Act of 20 13; 


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b) 
Conc~ssion - ~hall refer to the authority granted to a Person for the right to own, 
establish, provide, construct, install, operate and maintain Petroleum Pipeline systems 
for transportmg Petroleum Products; 
c) Contract of Concession - shall refer to the agreement executed between the DOE on 
behalf of th~ Government of the Republic of the Philippines and a Pipeline Operator 
grantll1g a Plpelll1e Concession; 
d) Crude Oil - means oil in its natural state before the same has been refined or 
otherwise treated, excluding water and foreign substances; 
e) DILG - shall refer to the Department ofInterior and Local Government; 
i) DOE - shall refer to the Department of Energy; 
g) DOH - shall refer to the Department of Health; 
h) DOTC - shall refer to the Department of Transportation and Communications; 
i) DPWH - shall refer to the Department of Public Works and Highways; 
j) Grantee - shall refer to a Person to whom a Concession for PetroleuJ1l Pipeline 
Operations has been granted by law; 
k) Local Government Units or LGUs - shall refer to the local government units created 
under the Local Government Code; 
1) MMDA - shall refer to the Metro Manila Development Authority; 
m) National Pipeline Board or NPB - shall refer to the Board created under Chapter VI, 
Section 16 of this Act; 
n) Petroleum Pipeline - shall refer to the system of Pipelines, including related Pipeline 
Facilities through which Petroleum Products are transported, including without 
limitation the pipeline, valves, break out tanks and other appurtenances connected to 
the pipeline and pumping units; 
0) Petroleum Products - shall refer to any liquid petroleum product obtained tl'om 
distilling and processing of crude oil, unfinished oils, natural gas liquids and other 
hydrocarbon compounds, The term shall exclude natural gas and liquefied natural gas; 
p) Petroleum Pipeline Operations - shall refer to the business of engaging in the 
Transportation of Petroleum Products through a Petroleum Pipeline; 
q) Petroleum - shall refer to crude oil, condensate and liquefied petroleum gas; 
r) Person - includes a natural person, corporation, or partnership; 
s) Pipeline or Line Pipe - shall refer to a tube, usually cylindrical, through which liquid 
Petroleum Product flows from one point to another; 
t) Pipeline Facility(ies) - shall refer to a new or existing Pipeline, including rights-of-
way and any equipment, facility or building used in the Transportation of Petroleum 
Products; 


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u) Pipeline Operators - Persons operating Petroleum Pipeline or Pipeline systems; 
v) PNP - shall refer to the Philippine National Police; and 
w) Tramp.orlation of Petroleum Products - shall refer to the conveyance, carriage or 
transmISSIOn of Petroleum Products through a Petroleum Pipeline(s). 
CHAPTER II 
JURISDICTION OF THE DEPARTMENT OF ENERGY 
SECTION 5. Jurisdiction. This Act strengthens and confirms the sole regulatory and 
adI11l11l~trallve pow~r and a~thority of the DOE to supervise and regulate Petroleum Pipeline 
OperatIOns. In addItron to ItS existing powers and functions, the DOE shall have the sole 
responsibility to supervise and regulate Petroleum Pipeline Operations. It shall: 
a) Formulate, in consultation with petroleum pipeline industry participants, a Petroleum 
Pipeline Code and such other rules and regulations to Implement this Act: Provided 
that, said regulations shall not be inconsistent with the standards and regulations 
adopted under the Petroleum Pipeline Code; 
b) Ensure the reliability and safety of transporting liquid petroleum products through 
pipelines; 
c) Enforce the Petroleum Pipeline Code as well as rules and regulations implementing 
this Act; 
d) Exercise original and exclusive jurisdiction over questions and cases involving 
Concessions as well as fees and fines imposed by the DOE in the exercise of the 
foregoing functions; and 
e) Exercise such other powers and functions as may be necessary to attain the objectives 
of this Act. 
CHAPTER III 
PIPELINE CONCESSION 
SECTION 6. Nature of a Pipeline Concession. A Concession is an authority granted to a 
Person for the right to establish, own, operate and maintain a Petroleum Pipeline(s) for 
transporting Petroleum Products. No Person may engage in Petroleum Pipeline Operations 
without a valid Concession obtained from the DOE: Provided that, Persons who are holders 
of existing Concessions or are existing Pipeline Operators shall not be required to secure a 
new Concession from the DOE for the remaining period of their current Concession. 
SECTION 7. Philippine Ownership Requirement. No Concession for the ownership, 
establishment, operation and maintenance of a Pipeline shall be granted except to citizens of 
the Philippines or to corporations or associations organized under the laws of the PhIllpp!l1es 
at least sixty percent (60%) of whose capital is owned by such citizens. 
SECTION 8. Term of Concession. The Concession shall be valid for a term of twenty five 
(25) years, renewable' for another twenty five (25) years, provided that, due consideration will 


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be given for the automatic renewal of the Grantee's Concession in view of the Grantee's 
sizeabl~ .investm:nts,. infrastructure ~n~ installations or the necessity and/or urgency of 
ma~ntalll1ng the I Ipeilne to selve pubilc mterest. For eXlstmg Plpelme Operators, the term of 
theIr Concessl~n shall be as provided in their existing Concession Agreements: Provided 
that, eXlst~l1gPlpehl1e ~perators may apply for a Contract of Concession under this Act prior 
to the expIration of their current Concession. 
CHAPTER IV 
PROCEDURES FOR APPLICATION OF CONCESSION 
SECTION 9. Application of Concession. Any applicant for Concession shall apply with the 
DOE pursuant to the requirements herein. An application for Concession under this Act shall 
be filed with the Oil Industry Management Bureau (OIMB) of the DOE which shall examine 
and pass upon the same as well as upon the qualifications of the applicant. 
SECTION 10. Requirements. The applicant must demonstrate that it is legally existing and 
qualified (0 conduct its business under Philippine laws and, taking into account the length and 
location of the Petroleum Pipeline, is financially and technically capable of operating and 
maintaining the same pursuant to this Act, the Petroleum Pipeline Code and the rules and 
regulations implementing this Act. 
SECTION 11. Public Notice. The OIMB shall issue a public notice of all Concession 
applications and afford interested parties an opportunity to comment on such applications. If 
no opposition is filed within the period provided in the public notice, it shall be conclusively 
presumed that no such opposition exist. Thereafter, no objection from third parties to the 
granting of the Concession shall be heard and the Contract of Concession shall be executed 
by the Secretary of the DOE on behalf of and for the Republic of the Philippines, and the 
Grantee, in accordance with this Act, the implementing rules and regulations and existing 
laws. 
SECTION 12. Disposition of Opposition to the Concession. If an Opposition is filed in 
accordance with Section 11 hereof, the DOE shall, decide based on the qualifications of the 
applicant pursuant to this Act, the implementing rules and regulations as well as merits of the 
oppositor's claims if the applicant is duly qualified to be granted a Concession. The DOE may 
require submission of additional documents and other papers and shall render a decision 
within fifteen (15) days from the date of filing of the opposition or from the date the case IS 
deemed submitted for resolution as may be provided in the implementing rules and 
regulations, without prejudice to the right of any aggrieved party to appeal to the courts 
pursuant to the Rules of Court. 
SECTION 13. Issuance of Concession. The DOE shall issue a Contract of Concession upon 
its determination that the establishment, operation and maintenance of the Petroleum 
Pipeline(s) by the applicant is consistent with this Act. The Contract of Concession shall state 
definitely the principal rights and obligations of the parties concerned pursuant to thiS Act. 
SECTION 14. Registry of Pipeline Operators. The DOE shall establish and maintain a 
registry of all pipeline operators or Concession Grantees. 
CHAPTER V 
RIGHTS GRANTED 


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SECTION 15. C!rant of Rights. Grantees of Pipeline Concessions acquire the right to own, 
construct, establIsh, operate and maintain a Petroleum Pipeline to transport Petroleum 
Products, by means of, and through, a Pipeline or system of Pipelines between the sources of 
production and/or refining and/or supply (storage) the places d~fined in the Pipeline 
Conces.slOl1, 111 accordance with the provisions of this Act and the implementing rules and 
regulations. 
This l:ight includes the construction, installation and operation of pipelines, pipeline facilities, 
pumpll1g stations, storage tanks and other buildings, water supply and communication 
systems, roads, and such other equipment or facilities as may be needed by the Grantee to 
conduct its Petroleum Pipeline Operations. 
Among other things, the Contract of Concession shall state definitely: 
a) The right of the Grantee to own, construct, install, operate and maintain a Petroleum 
Pipeline system passing through a designated area(s), specifying the province(s), 
city(ies) and/or mWlicipality(ies); 
b) The Grantee's right to acquire rights of way, easements and other similar rights on, 
over, under, across and through the designated area(s) or adjacent thereto; 
c) The right of eminent domain to be exercised by the Government, as represented by 
the DOE, for and on behalf of and/or through the Grantee, over private property when 
the occupation of private land is needed by the Grantee in connection with his 
Concession, for the purpose of constructing, installing, maintaining and operating 
Petroleum Pipelines, roads, wells, tanks, reservoirs, pumping stations for public use or 
benefit; 
d) Term of the Concession; 
e) Right to receive assistance from the DOE in obtaining fiscal and non-fiscal incentives 
granted by this Act; 
1) Right to receive assistance from the DOE and/or other government instrumentalities 
in securing permits, licenses and clearances relating to the Petroleum Pipeline 
Operations; and 
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g) Other rights consistent with this Act. 
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CHAPTER VI 
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THE NATIONAL PIPELINE BOARD AND THE PETROLEUM PIPELINE CODE 
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SECTION 16. National Pipeline Board. There is hereby created the National Pipeline Board., 
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The NPB shall be composed of the Secretary of the DOE as Chairman and the Secretanes of 
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the Department of Environment and Natural Resources, Department of Transportation and 
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Communication and the Department of Public Works and Highways, as members, and 
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representatives from Pipeline Industry operators, who shall automatically be members by 
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reason of being Grantees of a Pipeline Concession. The DOE Secretary, 111 IllS capaCIty as 
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Chairperson, shall, within thirty (30) days from the effectivity of this Act, convene the NPB 
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to discharge its powers and functions as provided in Section 17 hereof. The Board ,shal~,be, 
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assisted by a Technical Secretariat attached to the OIMB of the DOE. The number of statT of 
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the Technical Secretariat and the corresponding positions shall be determined by the Board, 
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subject to approval by the Department of Budget and Management (DBM) and existino civil 
service rules and regulations. 
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b 
SECTION 17. Powers and Functions ofrhe NPB. The NPB shall have the following powers 
and functions: 
a) It shall recommend to the DOE the standards for the design, construction, pressure 
testing, operation, and maintenance, corrosion control and abandonment of Petroleulll 
Pipeline systems. Within thirty (30) days from enactment of this Act, the NPB shall 
formulate a Petroleum Pipeline Code for approval by the DOE. The NPB may adopt 
such relevant and applicable standards from the United States Department of 
Transportation Regulations and American Society of Mechanical Engineers on 
Petroleum Pipelines as well as other internationally accepted standards for Petroleul11 
Pipelines. In view of changes in internationally accepted Petroleum Pipeline standards 
and Pipeline technologies, the NPB may revise and/or amend the Petroleum Pipeline 
Code; Provided that, the NPB may only introduce amendments after sumciently 
holding consultations with all its members to ensure transparency and further 
encourage private sector participation. The NPB may call on members from the 
academic community and experts from the private sector, and other pipeline industry 
participants as resource persons to aid in updating the Petroleum Pipeline Code. There 
shall be a mandatory review of the Petroleum Pipeline Code set pursuant to the 
provisions of this Act every two (2) years; 
b) In carrying out its dnties and functions nnder this section, it shall, whenever 
appropriate, be anthorized to utilize agencies of the government to obtain technical, 
economic and statistical information and advice; and 
c) It shall conduct periodic analyses of the domestic transport of Petroleum Products by 
Pipeline. Such analyses should identify the areas through which the Pipeline traverses 
where unplanned loss of Petroleum Pipeline may cause shortages of Petroleul11 
Products or price disruptions and where shortages of Pipeline capacity and reliability 
concerns may have or are anticipated to contribute to shOliages of Petroleum Products 
or price disruptions. Upon identifying such areas, the NPB may determine if the 
current level of regulation is sufficient to minimize the economic impact for such 
unplanned losses of Pipeline capacity. In preparing any analysis hereunder, the NPB 
may consult with the heads of other government agencies and public and private 
sector experts in Petroleum Pipeline Operations and other forms of Transportation of 
Petrolcuni Products, energy consumption', pipeline capacity, population and economic 
development. 
CHAPTER VII 
RIGHT OF WAY, EXPROPRIATION, EASEMENT 
SECTION 18. Grant of Right of Way. As may be required by the DOE or granted by the 
Concession, all government agencies and/or instrumentalities, including but not limited to the 
DPWH, the relevant LGUs, MMDA, their successors and assigns, shall grant the necessary 
right of way over non-private property within theirjurisdiction. 
SECTION 19. Priority. Due to the importance of a steady, safe and efficient supply of 
Petroleum Products, priority shall, whenever practicable, be given to Pipeline Operators 111 
acquiring right o[way over government property. 


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SECTION 20. Righi of Way over Private Property; Expropriation. The DOE shall assist or 
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represent Grantees of Concessions in procuring the necessary right of way over private 
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property. 
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When the occupation or possession of private land is needed by the Grantee in connection 
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with its Concession, for the purpose of constructing, installing, maintaining and operating 
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pipelines, reservoirs, wells, roads, railroads, telephone and telegraph lines, airfields, radiO 
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stations, powerhouses, transmission lines, pumping stations, wharves, piers, and terminals. 
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which are hereby declared to be for public use or benefit, the right of eminent domain may be 
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exercised by the Government, as represented by the DOE, for and on behalf of the Grantee, in 
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accordance with the applicable laws on the matter. In all cases of voluntary agreement 
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between the Grantee and a private landowner, a copy thereof shall be furnished the DOE. For 
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the purpose of this Section, the necessity of the work in Petroleum Pipeline Operations will 
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be presumed in cases of construction of Pipelines, tanks, pumping stations, power systems. 
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and other means of transportation and communication, including any auxiliary facilities and 
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works. 
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SECTION 21. Easement Over Public Land - When easement or right of temporary 
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occupancy over public land is needed by a Grantee for the purpose of carrying out any work 
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necessary to its Petroleum Pipeline Operations, such right may be granted by the Government 
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through the DOE subject to applicable laws and regulations. The same presumption in 
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'Section 20 applies in this instance. 
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CHAPTER VIII 
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COMPLIANCE WITH STANDARDS 
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SECTION 22. Petroleum Pipeline Code. All Grantees of a Pipeline Concession under this 
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Act shall provide safeguards for the safety, reliability, adequacy, security, stability and 
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integrity of their Petroleum Pipeline systems in accordance with the technical speciiicatiolls 
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and performance standards set forth in the Petroleum Pipeline Code to be promulgated by the 
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NPB, as may be amended. 
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CHAPTER IX 
PIPELINE SECURITY 
SECTION 23. Pipeline Security; One Call System. It is hereby declared that Petroleum 
Pipeline systems are imbued with public interest. For this purpose, the DOE, in coordination 
with the OND, DPWH, PNP, MMDA, DILG, LGUs and the appropriate government 
agencies and instrumentalities shall implement a one-call system, whereby a~1Y third party 
shall report to a designated agency any possible excavation, installation or actIvIty which may 
affect Pipelines as well as any act which may result in damage to property or InjUry to 
persons. The one-call system is intended to bring to immediate notice of the toregoll1g to the 
affected Grantee or other underground utility providers and to prOVide a mechal1lsm lor 
immediate liaison and coordination with all relevant government agencies to avoid damage to 
or loss of property as well as injury to persons. 
The DOE shall implement a procedure for a systematic response to. emergency. cases. 
including without limitation, incidents involving leaks, breaches on the Plpeill1es or PIpelIne 
facilities and other similar occurrences, whereby there will be Immediate, appropl'late and 
coordinated response actions from the concerned LGUs, B~reau of Fil:e ProtectIon, the. 
OENR, 001-1 and such other government agencies and ll1strumentaiItIes. In. case of 
remediation or clean-up, the DENR shall be the lead agency (in coordll1atIon With other 
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government agencies or instrumentalities) in directing the clean-up of affected areas premised 
on a risk-based criteria. 
SECTION 24. fnter-(1gency Cooperation. -
SJJOuld the DOE find it necessary. it shall 
consult, partICIpate, cooperate and enter into agreement with other government agencies and 
ll1strument~lItles, non-governmental organizations or people's organizations and private 
enterpnses III the furtherance of the foregoing objectives. 
CHAPTER X 
ROLE OF GOVERNMENT AGENCIES 
SECTION 25. Role of Government Agencies. In the Implementation of the provisions of this 
Act, its implementing rules and regulations and related laws, the following agencies shall 
perform, among others, the following functions: 
a) The DOTC shall: 
I. Assist in coordinating networks for the transportation of Petroleum as well as 
the fast and safe transportation services thereof, as determined by the DOE: 
and 
2. When requested by the DOE, assist the DOE in identifying routes, zones or 
areas of operations of particular operators. 
b) The DPWH shall, when necessary, provide the technical support in the construction 
and installation of Petroleum Pipelines. 
c) The DILG shall: 
l. Provide, through the Philippine National Police (PNP), manpower and 
available resources to Grantees of Pipeline Concessions in cases of threats to 
the security of the Pipelines and other similar acts; 
2. Employ the assistance, cooperation and coordination of LGUs 
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implementation of the policies and orders issued by the DOE; and 
3. Mobilize the Bureau of Fire Protection (BFP) to ensure the prevention and 
suppression of all destructive fires on the Petroleum Pipeline installations. 
d) The corresponding LGUs, where the Pipelines are situated, shall share in the 
responsibility of implementing safety and prevention measures within their territorial 
jurisdiction solely with 'respect to third parties who may affect the Pipelines situated 
within their respective territorial jurisdictions. 
CHAPTER XI 
ABANDONMENT AND DECOMMISSIONING 
SECTION 26. Abandonment and Decommissioning. At the expiration of the term of the 
Contract of Concession or a renewal thereof, or when a Pipeline has come to the end of its 
useful life and/or users or customers of the Petroleum Product have discontinued using the 
Pipeline to transport Petroleum Products or there are no foreseeable new users or customers 


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in the future, the Grantee shall undertake Pipeline decommissioning and cleaning. The 
Pipelines shall be cleaned and decontaminated before it can be either left in its existing place 
or dismantled for proper disposal. 
The DOE, through appropriate regulations, may provide guidelines for: 
a) the clean-up of residual fluids in the Pipeline and proper disposal thereof In 
accordance with applicable environmental laws and regulations; 
b) decontaminated Pipelines which may be trenched or buried underground; 
c) environmental concerns have been addressed; and 
d) whether such Pipelines can be left in place without creating any risk to the 
surrounding environment or to the community. 
SECTION 27. Decommissioning Fund. For this purpose, the DOE shall, after public 
consultation with Pipeline Operators and Pipeline industry participants, implement a system 
whereby the Pipeline Operator shall collect from its users or customers decommissioning 
costs/fees, to be agreed upon between the Pipeline Operator and the users or customers. 
These decommissioning costs or fees shall be held in a Decommissioning fund, established 
jointly by the Pipeline Operator and its users or customers and administered by the Pipeline 
Operator specifically to pay for the costs of decommissioning. The Decommissioning Fund 
shall not be su~ject to Value Added Tax, income tax and such other taxes, charges and fees. 
. CHAPTER XII 
FISCAL INCENTIVES 
SECTION 28. Taxes. Pipeline operations shall be subject to the payment of all taxes, duties. 
fees or charges and other impositions under the National Internal Revenue Code of 1997, as 
amended, and other applicable laws; Provided however, that in recognition of the substantial 
investments needed for the construction, installation, operation and maintenance of the 
Grantee, the Grantee shall be entitled to an income tax holiday and such other incentives 
granted to pioneer enterprises under the Omnibus Investments Code, as amended. 
SECTION 29. Customs Duties. The Grantee may impOlt, free of applicable customs duties 
and charges, all equipment, machinery, material, instruments, supplies and accessories 
necessary for the installation, construction, operation and maintenance of the Petroleum 
Pipeline. 
CHAPTER XIII 
FORCE MAJEURE AND/OR FORTUITOUS EVENTS 
SECTION 30. Force Majeure and/or Fortuitous Events. Failure on the part of the Grantee to 
fulfill any of the terms and conditions provided by this Act or its implementing rules and 
regulations or by other relevant laws shall not be deemed a breach of such obhgatlOn on the 
part of the Grantee in so far as such failure results from force majeure and/or fortultolls 
events, including without limitation, acts of God, war, insurrection, riot, civil commotion. 
strike, tide, storm, Dood, lightning, explosion, fire earthquake, passage of laws, orders and 
rules and any other happening which the Grantee could not reasonably prevent. control or 
avoid. 
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CHAPTER XIV 
PROHIBITED ACTS 
SECTION 31. Prohibited Acts. Without the prior written consent of the Grantee. it shall be 
unlawful for any Person to: 
a)' Demolish; excavate, tunilel, or construct, drill, install, or make improvements within 
five (5) meters from the nearest portion of the Pipeline facility; 
b) Cut, saw, slice, separate, split, sever, smelt, remove, mutilate, alter, tap, reconnect. 
disconnect, or in any way tamper any Pipeline or part thereof, or any other pipeline 
related installation from the place of installation of any other place or site where it 
may be rightfully or lawfully situated; 
c) Take, carry away, transport, transfer, move, with or without the use of a motor vehicle 
or any other means of conveyance, the Pipeline, or part thereof, or any other Pipeline 
related installation; 
d) Store, possess, or otherwise keep in his premises, custody or control, any portion of 
the Pipeline including Pipeline related installation; and 
e) Knowingly use or receive the direct benefit of petroleum delivery service obtained 
through any of the acts mentioned in paragraphs (a), (b), (c) and (d) above. 
SECTION 32. Fines and Penalties for Unlawful Acts. Any person who commits any of the 
foregoing acts shall suffer the penalty of a fine of not less than Ten Thousand Pesos 
(PhPlO,OOO.OO) bnt not more than Five Million Pesos (PhP5, 000,000.00) or imprisonment of 
not less than six (6) months, or both shall be imposed. If the offender is ajuridical person. the 
president, manager, directors, trustees, officers or the officials directly in charge of the 
operations shall suffer the penalty herein provided. 
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CHAPTER XV 
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APPROPRIATIONS 
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SECTION 33. Appropriations. Such sums as may be necessary for the initial implementation 
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of this Act shall be taken by the DOE from its anllual appropriation. Thereafter. the fund 
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necessary to carry out the provisions of this Act shall be included in the annual General 
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Appropriations Act. 
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CHAPTER XVI 
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FINAL PROVISIONS 
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.SECTION 34. implementing Rules and Regulations. The DOE, in coordination with the 
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NPB, shall promulgate the necessary implementing rules and regulations within thirty (30) 
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days after the effectivity of this Act. There shall be a mandatory review every two (2) years 
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of the implementing rules and regulations and the pipeline standards sel. pursuant to the 
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provisions ofthis Act. 
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SECTION 35. Separability Clause. If any provision of this Act is declared invalid or 
unconstitutional, the other provisions not affected thereby shall remain valid and subsisting. 
SECTION 36. Non~Retroactivity Clause. Concessions which have been granted under 
previOus laws at the tune tillS Act becomes effective, shall remain effective and shall continue 
to operate under their existing Concessions or authority. 
SECTION 37. Grantees of Concessions under Other Laws. Nothing in this Act shall be 
deemed to revoke any existing Concession granted under the Petroleum Act of 1949, as 
amended, or other administrative or regulatory permit, authority or contract, which 
Concession, Permit, Authority or Contract shall be allowed to its full term or renewal thcreoj~ 
but may not be renewed except pursuant to the provisions of this Act. 
SECTION 38. Precursor laws. Under the Petroleum Act of 1949, as amended, the power to 
grant pipeline concessions was granted to the Secretary of Agriculture and Natural 
Resources. The authority over pipeline concessions under the Petroleum Act was transferred 
to the Petroleum Board pursuant to Presidential Decree No. 782 dated 25 August 1975. The 
Petroleum Board was thereafter abolished and its powers and functions were transferred to 
the Energy Development Board in accordance with Presidential Decree No. 910 dated 22 
March 1976. The Energy Development Board (EDB) was abolished by Presidential Decree 
No. 1206 dated 6 October 1977. The powers and functions ofthe EDB were transferred to the 
Bureau of Energy Development under the Department of Energy pursuant to Section 12 of 
Presidential Decree No. 1206. Presidential Decree No. 1700 issued on 10 July 1980 amended 
Presidential Decree No. 1206 by transferring the power to regulate and fix the rates of 
pipeline concessionaires under the Petroleum Act to the Board of Energy. The powers of the 
Board of Energy to grant and regulate pipeline concessions were later transferred to the 
Energy Regulatory Board under Section 3 of Executive Order No. 172. Executive Order No. 
193 abolished the Bureau of Energy Development on 10 June 1987 and transferred its 
pertinent functions to the Office of the Deputy Executive Director for Energy Operations of 
the Office for Energy Affairs. The non-price regulatory jurisdiction, powers and functions of 
the Energy Regulatory Board were thereafter transferred to the DOE, pursuant to Sections 12 
c) and 18 of Republic Act No. 7638, otherwise known as the Department of Energy Act of 
1992. Subsequently, the powers and functions of the Energy Industry Administration Bureau, 
which includes the formulation and implementation of policies, programs and regulations on 
the downstream oil industry, including the transportation of petroleul11 crude oils, products 
and by-products, were transferred to the Oil Industry Administration Bureau under 
Administrative Order No. 38 issued on 23 August 2002. Pursuant to Section 44 of Republic 
Act No. 9136, otherwise known as the "Electric Power Industry Reform Act of 2001 ", the 
non-price regulatory functions of the Energy Regulatory Board were transferred to the 
Energy Regulatory Commission. 
SECTION 39. Repealing Clause. The provisions of Republic Act No. 387, otherwise known 
as the "Petroleum Act of 1949", as amended and the provisions of all foregoing precursor 
laws, and such other laws, acts, executive orders, rules and regulations and other issuances 
inconsistent with this Act are hereby repealed or modified accordingly. 
SECTION 40. Transitory Provision. Pipeline Operators or Grantees of Petroleum Pipeline. 
Concessions which have been constructed and have commenced operatIOn pnor to the date oj 
effectivity of this Act shall continue to operate under their existing authorities. ,Nothing in 
this Act shall be deemed to revoke or otherwise modify any of the powers and j unclions oj 
the Director of Mines and the Secretary of Agriculture and Natnral Resources and its 
successors and assigns under the Petroleum Act of 1949, as amended, any existing 
Concession granted under the Petroleum Act of 1949, as amended, or any adm1l11stratlve or 


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regulatory permit or concession, which concession certificate or franchise shall be allowed to 
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its full term but may not be renewed except pursuant to the provisions of this Act. 
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SECTION 41. Effectivity. This Act shall take effect fifteen (15) days upon its publication in 
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the Ot1icial Gazette or in at least two (2) newspapers of general circulation. 
Approved, 
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