WM Senate
NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES
First Regular Session
SENATE
23 MAR 13 P5 -08
RFCEIVtD BV;
S. B. NO. Ipqi
Introduced by SENATOR JOEL VILLANUEVA
AN ACT
PROVIDING FOR THE NATIONAL FRAMEWORK FOR THE 
DEVELOPMENT AND REGULATION OF THE PHILIPPINE 
MIDSTREAM NATURAL GAS INDUSTRY, APPROPRIATING 
FUNDS THEREFOR AND FOR OTHER PURPOSES
EXPLANATORY NOTE
According to the Department of Energy (DOE), natural gas accounted for 
5.5% of the total primary energy supply of the country and generated 18% of On 
Grid power generation in 2021.1
Since it began operations in 2001, the Malampaya Deep Water Gas-to- 
Power project, the country’s major source of natural gas, has produced cleaner­
burning natural gas which supplies five power plants in Luzon with a combined 
capacity of 3,200 megawatts. Its operations resulted in the reduction of oil 
imports and the provision of a more stable supply of cleaner energy from an 
indigenous resource.2 However, the Malampaya gas field is projected to be 
depleted by 2027.3
In view of the impending depletion of the natural gas reserves in 
Malamapya, and to continue to promote diversification of sources for the 
country’s primary energy supply. It is necessary to have a clearer regulatory and 
legal framework to govern the promotion and development of the midstream 
natural gas industry.
1 October 7, 2022. DOE 2023 Proposed Budget Presentation.
2 Overview of Malampaya. Retrieved from: https://malampaya.com/about/ (Last accessed on December 4, 2022)
3 November 25, 2022. Latest look into the country’s oil and gas industry. Retrieved from:
https://www.bworldonline.eom/special-features/2022/11/25/489398/latest-look-into-the-countrys-oil-and-gas-industry/(Last 
accessed on December 4, 2022).


Recognizing this need, this bill seeks to set parameters with respect to the 
use, access, rate setting, transportation, and transmission of natural gas in the 
country. This bill also seeks to ensure that natural gas industry operations are 
compliant with international and local best practices and standards, including the 
provisions on the health and safety of workers pursuant to Republic Act No. 
11058, otherwise known as the Occupational Safety and Health Law, and other 
applicable laws, rules and regulations. This bill also encourages the participation 
of the private sector, while ensuring that safeguards are in place to prevent anti­
competitive behavior and for a more transparent rate setting process.
In view of the foregoing, and as one of the priority measures of the Marcos 
Administration, the immediate passage of the bill is earnestly sought.
SENATOR JOEl/VILLANUEVA


&>rua^r
NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES
First Regular Session
)
SENATE
S. B. NO. 1991
23 MW 13 P5-08
Htaivtor:
Introduced by SENATOR JOEL VILLANUEVA
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AN ACT
PROVIDING FOR THE NATIONAL FRAMEWORK FOR THE 
DEVELOPMENT AND REGULATION OF THE PHILIPPINE 
MIDSTREAM NATURAL GAS INDUSTRY, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines 
in Congress assembled:
CHAPTER 1
GENERAL PROVISIONS
SECTION 1. Short Title. - This Act shall be referred as the “Midstream 
Natural Gas Industry Development Act.”
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State
to:
(a) 
Ensure the country’s energy security by developing diversification of sources of 
primary energy supply to various sectors of the economy;
(b) 
Promote the role of natural gas as an additional energy source and 
complementary fuel to variable renewable energy by creating a legal and 
regulatory framework that would govern the promotion and development of the 
natural gas industry in the country:
(c) 
Create a regulatory environment that will foster a competitive market for natural 
gas;
(d) 
Encourage the inflow of private capital in the development of the midstream 
natural gas industry:


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(e) 
Ensure a safe, secure, reliable, and environmentally responsible operation of 
the midstream natural gas value chain to include personnel and user protection, 
through the formulation and adoption of local or international standards on 
health, safety, security and the environment; and
(f) 
Protect midstream end users by mandating transparent and fair rate, fees, and 
charges.
SEC. 3. Scope and Application. - This Act shall apply to the midstream 
natural gas industry, specifically the aggregation, supply, importation, exportation, 
receipt, unloading, loading, processing, storage, regasification, transmission, 
bunkering, and transportation of natural gas, in its original or liquefied form, from 
local or foreign sources, and the systems and facilities utilized for such. It shall also 
apply to the rehabilitation, repair, maintenance decommissioning, and abandonment 
of such systems and facilities.
SEC. 4. Definition of Terms. - For purposes of this Act, the following terms 
shall mean:
(a) 
Affiliate refers to any natural or juridical person who, singly or jointly with other 
natural or juridical persons, directly or indirectly, through one or more 
intermediaries, controls, is controlled by, or is under common control with 
another natural or juridical person. It includes a subsidiary company, a parent 
company, and the subsidiaries, directly or indirectly, of a common parent;
(b) 
Ancillary reserve refers to the natural gas procured by the natural gas 
transmission utility or the Natural Gas Transmission System Operator 
(NGTSO), whichever is applicable, necessary in the operation of the natural 
gas transmission system to regulate fluctuations in its operating pressure and 
maintain system stability, safety, and efficiency to ensure the continuous 
transmission of natural gas to midstream end-users in accordance with the 
Natural Gas Transmission Code. It shall be included in the natural gas 
transmission fee or the NGTSO fee, whichever is applicable;
(c) 
Anticompetitive behavior refers to any act enumerated under Section 14 and 
Section 15 of Republic Act No. 10667, otherwise known as the Philippine 
Competition Act;
(d) 
Capacity refers to the handling design of a system used in the context of its 
functionality, expressed in a specific measurement such as volume in cubic 
meters or flow rate in normal cubic meters per time unit;
(e) 
Control refers to the power to determine the financial and operating policies of 
an entity to benefit from its activities. It is presumed to exist when the parent 
entity owns, directly or through subsidiaries or associates, more than fifty 
percent (50%) of the voting power of an entity. It also exists when the parent 
entity owns fifty percent (50%) or less of the voting shares of an entity, but has 
any of the following powers:
(1) Power over more than fifty percent (50%) of the voting rights by virtue of 
an agreement with other investors;
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(2) 
Power to govern the financial and operating policies of the entity under a 
statute or agreement;
(3) 
Power to appoint or remove the majority of the members of the board of 
directors or equivalent governing body; or
(4) 
Power to cast the majority of votes at meetings of the board of directors or 
equivalent governing body;
(f) 
Dedicated natural gas pipeline refers to a pipeline exclusively utilized by a 
midstream natural gas industry participant or its affiliates for the conveyance of 
natural gas from an LNG terminal or a local natural gas production facility to the 
said midstream natural gas industry participant or its affiliates;
(g) 
Emergency reserve refers to the amount of natural gas, in its original or 
liquefied form, which may be contracted by midstream end users based on 
public interest, sufficient to ensure a continuous, adequate, and stable supply of 
natural gas for a specified period in the event of a supply disruption. Such 
period shall be determined in the implementing rules and regulations (IRR) of 
this Act;
(h) 
Importation refers to the bringing of natural gas, in its original or liquefied form, 
into the Philippines from foreign sources;
(i) 
Gas aggregation refers to the activity of pooling together various demands for 
natural gas from midstream end users and supplying them with natural gas 
from one or more sources;
(j) 
Gas aggregator refers to any natural or juridical person who engages in gas 
aggregation;
(k) 
Liquefied natural gas (LNG) refers to natural gas which has been cooled to a 
cryogenic temperature, converting it to a liquid state;
(l) 
LNG Bunkering refers to the selling of natural gas for use of domestic or 
foreign marine vessels;
(m) LNG Bunkering facilities refer to all infrastructures built and designed for LNG 
bunkering;
(n) 
LNG terminal refers to ail facilities located onshore or offshore, that are used to 
import, receive, unload, load, process, store, and re-gasify natural gas, in its 
original or liquefied form, from local or foreign sources. It shall include berthing 
ports, unloading and loading arms, line packs, cryogenic pipelines, 
regasification facilities, and storage tanks, among others;
(o) 
LNG Terminal Development Plan refers to a comprehensive plan prepared by 
each LNG terminal owner and operator relating to the location, construction, 
improvement, operation, utilization expansion, modification, rehabilitation,
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repair, maintenance decommissioning, and abandonment of each of its LNG 
terminals and all its required facilities and equipment, taking into consideration, 
among others, existing and projected demand and supply of natural gas;
(p) 
LNG Terminal regulated Third Party Access Code refers to the compendium of 
responsibilities, qualifications, standards, and rules promulgated by the 
Department of Energy (DOE) for regulated third party access by one or more 
third parties to a portion, the entire, or the unutilized capacity of an rTPA LNG 
terminal permit holder, and the evaluation of performance of an LNG terminal 
with respect thereto;
(q) 
Midstream end users refers to any natural or juridical person, requiring the 
supply of natural gas, in its original or liquefied form, for resale or own use, but 
excluding the retail use of natural gas. It includes power generation plants, 
industrial and commercial establishments, ecozones, storage facilities, 
bunkering facilities, virtual pipelines, and motor vehicles and marine vessels 
transporting natural gas;
(r) 
Midstream natural gas industry refers to the aggregation, supply, importation, 
exportation, receipt, unloading, loading, processing, storage, regasification, 
transmission, bunkering, and transportation of natural gas, in its original or 
liquefied form, but shall exclude the retail of natural gas. It utilizes, among 
others, LNG terminals, dedicated natural gas pipelines, natural gas 
transmission systems, storage facilities, bunkering facilities, virtual pipelines, 
and motor vehicles and marine vessels transporting natural gas;
(s) 
Midstream Natural Gas Industry Development Plan refers to the 
comprehensive plan for ensuring safe, secure, and reliable supply of natural 
gas, in its original or liquefied form, while establishing the efficient operations of 
the country’s midstream natural gas infrastructure and managing demand for 
natural gas through specific government programs and policies. It shall include 
the various LNG Terminal Development Plans and Natural Gas Transmission 
Development Plans, and studies on over-all supply and demand, capacity, and 
other research necessary in achieving a sound demand and supply projection 
for natural gas in the country;
(t) 
Midstream natural gas industry participants refer to the supplier or importer of 
natural gas; gas aggregator; owner and operator of LNG terminal, dedicated 
natural gas pipeline, natural gas transmission system, storage and bunkering 
facilities, virtual pipelines, and motor vehicle and marine vessels utilized to 
transport natural gas; the Natural Gas Transmission System Operator; third 
parties; and midstream end users;
(u) 
Natural gas refers to gas obtained from boreholes and wells consisting primarily 
of a mixture or methane, ethane, propane, and butane with small amounts of 
heavier hydrocarbons and some impurities, notably nitrogen and complex sulfur 
compounds and water, carbon dioxide, and hydrogen sulfide as well as non- 
conventional gas including gas from bituminous shale;


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(v) 
Natural Gas Transmission Code refers to the compendium of rules, procedures, 
requirements, regulations, and minimum technical performance standards 
governing the safe and reliable location, construction, improvement, operation, 
utilization, expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of all dedicated natural gas pipelines and 
natural gas transmission systems in the country. It also defines and establishes 
the relationship of dedicated natural gas pipelines and natural gas transmission 
system with facilities and installations of other midstream natural gas industry 
participants, if applicable;
(w) 
Natural Gas Transmission Development Plan refers to the plan of each 
dedicated own use of pipeline owner and operator, natural gas transmission 
utility, or the Natural Gas Transmission System Operator when applicable, for 
managing dedicated own use pipelines, natural gas transmission systems or 
the interconnected natural gas transmission system, whichever is applicable, 
through efficient planning for its location, construction, improvement, operation, 
utilization, expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment;
(x) 
Natural Gas Transmission System refers to a network containing pipelines and 
other related facilities, owned and operated by a natural gas transmission utility, 
which convey natural gas, in its original or liquefied form, from an LNG terminal 
or a local natural gas production facility to a midstream natural gas industry 
participant;
(y) 
Natural gas transmission fee refers to the amount paid by midstream natural 
gas industry participants for the use of a natural gas transmission system. It 
shall consist of amounts used to defray the costs of location, construction, 
improvement, operation, utilization, expansion, modification, rehabilitation, 
repair, maintenance, decommissioning, and abandonment of the system, and 
provide a reasonable rate of return. It also includes the cost of operating the 
system while there is no Natural Gas Transmission System Operator;
(z) 
Natural Gas Transmission System Operator (NGTSO) refers to a natural or 
juridical person responsible for operating and maintaining the interconnected 
natural gas transmission system, ensuring the continuous and reliable delivery 
of natural gas to midstream natural gas industry participants, and securing the 
long-term ability of the system to meet demand for the transmission of natural 
gas;
(aa) Natural gas transmission utility refers to a natural or juridical person who has a 
franchise granted by law to construct, own, and operate a natural gas 
transmission within a specified area;
(bb) Negotiated third party access (nTPA) refers to a contractual arrangement 
between the owner and operator of a dedicated natural pipeline or an own use 
LNG terminal permit holder and a third party to allow the use and access to 
such third party of a specific capacity of a dedicated natural gas pipeline or an 
LNG terminal with an own use permit for a fee agreed upon between the two 
entities. It does not include contractual arrangements entered into by an own


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use LNG terminal permit holder and a third party pursuant to a declaration of 
unutilized capacity by the DOE in accordance with the LNG Terminal Regulated 
Third Party Access Code;
(cc) NGTSO fee refers to the amount paid by midstream natural gas industry 
participants to the NGTSO for its services in operating and maintaining the 
interconnected natural gas transmission system;
(dd) Own use LNG terminal permit holder refers to an LNG terminal whose owner 
and operator has been issued an own use permit;
(ee) Own use permit refers to an authorization issued by DOE to the owner and 
operator of an LNG terminal to exclusively use or allow its affiliate to use a 
specific capacity of the LNG terminal for a specified period of time, subject to 
LNG Terminal Regulated Third Party Access Code;
(ff) Permit refers to an authorization issued by the DOE, the Energy Regulatory 
Commission (ERC), or the Department of Transportation (DOTr) or its attached 
agencies, whichever is applicable, for the aggregation, supply, importation, 
exportation, receipt, unloading, loading, processing, storage, regasification, and 
bunkering of natural gas, or the location, construction, improvement, operation, 
utilization, expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of an LNG terminal, natural gas 
transmission system, dedicated natural gas pipeline, storage facilities, 
bunkering facilities, virtual pipelines, and motor vehicles and marine vessels 
transporting natural gas for a specified period of time;
(99) Permit holder refers to a natural or juridical person who is granted a permit by 
the DOE, ERC, or DOTr, or its attached agencies whichever is applicable, to 
engage in the aggregation, supply, importation, exportation, receipt, unloading, 
loading, processing, storage, regasification, and bunkering of natural gas, or 
the location, construction, improvement, operation, utilization, expansion, 
modification, rehabilitation, repair, maintenance, decommissioning, and 
abandonment of an LNG terminal, natural gas transmission system, dedicated 
natural gas pipeline, storage facilities, bunkering facilities, virtual pipelines, and 
motor vehicles and marine vessels transporting natural gas for a specified 
period of time;
(hh) Philippine National Standard (PNS) refers to the standards promulgated by the 
Department of Trade and Industry (DTI) - Bureau of Philippine Standards (BPS) 
pertaining to product specifications, test methods, terminologies, procedures, or 
practices pursuant to Republic Act No. 4109, otherwise known as the Standard 
Act, and other applicable laws, rules and regulations;
(ii) Regulated third party access (rTPA) refers to a contractual arrangement 
between the following:
(1) An rTPA LNG terminal permit holder or a natural gas transmission utility 
and a third party to allow the latter transparent, fair, reasonable, and non- 
discriminatory use and access of the capacity available to third parties of 
the LNG terminal or the natural gas transmission system;


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(2) 
An own use LNG permit holder and a third party pursuant to a declaration 
of unutilized capacity by the DOE in accordance with the LNG Terminal 
Regulated Third Party Access Code; or
(3) 
A natural gas transmission utility and a third party pursuant to a 
declaration of unutilized capacity by the DOE in accordance with the 
Transmission Regulated Third Party Access Code;
(jj) Regulated third party access (rTPA) permit refers to an authorization issued by 
the DOE to the owner and operator of an LNG terminal to offer to third parties, 
the fair, reasonable, and non-discriminatory use of access of a specific capacity 
of its LNG terminal for a specified period of time, subject to the LNG Terminal 
Regulated Third Party Access Code;
(kk) Reserve price refers to the undisclosed rate determined by ERC using a 
methodology pursuant to Section 6 of this Act that serves as the price ceiling 
for the natural gas transmission fee;
(II) Retail refers to the sale of natural gas to the general public in relatively small 
quantities for consumption, such as the sale of natural gas to motor vehicles 
and households;
(mm)rTPA LNG terminal permit holder refers to an LNG terminal whose owner or 
operator has been issued an rTPA permit;
(nn) Storage refers to the stocking of natural gas for the purpose of regasification, 
bunkering, reserve, any combination thereof, or any other purpose consistent 
with this Act;
(oo) Storage facilities refers to any equipment or infrastructure used for storage;
(pp) Sivpp//er refers to a natural or juridical person authorized by the DOE to engage 
in supply as defined in this Act;
(qq) Supply refers to the trade or indigenous or imported natural gas, in its original 
or liquefied form, and its subsequent sale or transfer to midstream natural gas 
industry participants;
(rr) Terminal fee refers to the rates, charges and other similar considerations 
imposed upon third parties for the use and services of any of the following:
(1) 
The capacity or a portion thereof covered by an rTPA permit of an LNG 
terminal, or
(2) 
The unutilized capacity or a portion thereof covered by an own use permit 
of an LNG terminal;


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(ss) Third party refers to a midstream natural gas industry participant who is not the 
owner, operator, or affiliate of the owner and operator of an LNG terminal, 
dedicated natural gas pipeline, or natural gas transmission system;
(tt) Transmission refers to the conveyance of natural gas, either through a 
dedicated natural gas pipeline, or natural gas transmission system;
(uu) Transmission Regulated Third Party Access Code refers to the compendium of 
responsibilities, qualifications, standards, and rules promulgated by the ERCfor 
regulated third party access by one or more third parties to a portion, the entire, 
or the unutilized capacity of a natural gas transmission system, and the 
evaluation of performance of a natural gas transmission utility with respect 
thereto;
(vv) Utilized capacity refers to a portion of a capacity of an LNG terminal, with an 
own use permit, an rTPA permit or both, or a natural gas transmission system, 
set apart for the use of the LNG terminal owner and operator or a third party 
with rTPA to the LNG terminal or the natural gas transmission system, which 
remains unused after a reasonable period of time and declared as such by the 
DOE or ERC pursuant to this Act and the LNG Terminal Regulated Third Party 
Access Code and the Transmission Regulated Third Party Access Code, 
whichever is applicable; and
(ww) Virtual Pipelines refer to alternative methods of transporting natural gas using 
modules coupled to mobile platforms such as motor vehicles, marine vessels, 
or rail platforms.
CHAPTER li
POWERS AND RESPONSIBILITIES OF GOVERNMENT AGENCIES
SEC. 5. Powers and Responsibilities of the Department of Energy (DOE).
- In addition to its functions under Republic Act No. 7638, otherwise known as the
Department of Energy Act of 1992, the DOE shall be the lead implementing agency
for this Act. Towards this end, it shall:
(a) 
Supervise and monitor the development of the midstream natural gas industry, 
and ensure the security and sufficiency of the supply of natural gas for local 
demand;
(b) 
Require the annual submission of, review, and approve LNG Terminal 
Development Plans and Natural Gas Transmission Development Plans: 
Provided, That the specific guidelines and timeline for the approval of these 
plans shall be determined by the policy declarations of this Act and upon 
consultation with other relevant government agencies, midstream natural gas 
industry participants, and other public and private stakeholders;
(c) 
Prepare a Midstream Natural Gas Industry Development Plan based on the 
various LNG Terminal Development Plans and Natural Gas Transmission 
Development Plans within two (2) years from the affectivity of this Act’s 
implementing rules and regulations, upon consultation with other relevant
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government agencies, midstream natural gas industry participants, and other 
public and private stakeholders. The Midstream Natural Gas Industry 
Development Plan shall be reviewed and updated annually, and integrated into 
the Philippine Energy Plan;
(d) 
Promulgate the PNS or identify and adopt other international standards 
adopted as PNS by the DTI-BPS, together with relevant government agencies 
and upon consultation with midstream natural gas industry participants and 
other public and private stakeholders, within eighteen (18) months from the 
effectivity of this Act’s implementing rules and regulations, for the following:
(1) 
Natural gas, in its original or liquefied form;
(2) 
Location, construction improvement, operation, utilization expansion, 
modification, rehabilitation, repair, maintenance decommissioning, and 
abandonment of all LNG terminals;
(3) 
Storage and bunkering of natural gas and its respective facilities;
(4) 
Virtual pipelines; and
(5) 
Motor vehicles and marine vessels transporting natural gas;
(e) 
Ensure compliance with the health, safety, security, and environmental 
standards of the following, together with the Department of Health (DOH), 
Department of Labor and Environment (DOLE), and other relevant government 
agencies:
(1) 
Natural gas, in its original or liquefied form;
(2) 
Location, construction improvement, operation, utilization expansion, 
modification, rehabilitation, repair, maintenance decommissioning, and 
abandonment of all LNG terminals,
(3) 
Storage and bunkering of natural gas and its respective facilities;
(f) 
Convene and co-chair with DTI-BPS, within two (2) months from the effectivity 
of this Act, a technical working group composed of relevant government 
agencies to include the ERC, DTI, DOTr, DENR, DOH, DOLE, Department of 
Interior and Local Government (DILG), their respective attached agencies, 
midstream natural gas industry participants, and other relevant public and 
private stakeholders to ensure consistent and streamlined standards and 
regulations in the midstream natural gas industry. The members of the 
technical working group shall fully cooperate and collaborate in the creation, 
promulgation, and streamlining of standards and regulations;
(g) 
Promulgate the guidelines for the establishment of safety and exclusion zones 
of LNG terminals, and determine such safety and exclusion zone for every LNG 
terminal, in consultation with the technical working group, relevant government 
agencies, local government units, and public and private stakeholders;


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(h) 
Evaluate and act on the applications for the location, construction, 
improvement, operation, utilization, expansion, modification, rehabilitation, 
repair, maintenance decommissioning, and abandonment of all LNG terminals 
as well as storage facilities and bunkering facilities;
(i) 
Issue (i) permits for the aggregation, supply, importation, exportation, receipt, 
unloading, loading, processing, storage, regasification, and bunkering of natural 
gas, in its original or liquefied form in accordance with this Section, and (ii) Own 
use and rTPA permits to owners and operators of LNG terminals;
G) Establish a methodology and timeframe for the determination of the unutilized 
capacity of LNG terminals, which shall be integrated in the LNG Terminal 
Regulated Third Party Access Code, taking into consideration the following: (i) 
reasonable period to use the capacity, (ii) existing market demand, and (iii) 
existing contracts;
(k) 
Promulgate the LNG Terminal Regulated Third Party Access Code, within one 
(1) year from the effectivity of this Act’s implementing rules and regulations, and 
upon consultation with other relevant government agencies, midstream natural 
gas industry participants, and other public and private stakeholders, and ensure 
compliance therewith. The LNG Terminal Regulated Third Party Access Code 
shall govern the creation of (i) a reliable and continuous supply of natural gas, 
and (ii) transparent, fair, reasonable, and non-discriminatory use and access;
(l) 
Declare the unutilized capacity of an LNG terminal and mandate Regulated 
Third Party Access for such in accordance with the LNG Terminal Regulated 
Third Party Access Code;
(m) Determine minimum guidelines to ensure the transparent, fair, reasonable, and 
non-discriminatory conduct of competitive selection processes by owners and 
operators of LNG terminal: Provided, That these minimum guidelines shall not 
include the mode of competitive selection process;
(n) 
Approve or disapprove any sale, assignment, or transfer of control to another 
entity by a midstream natural gas industry participant with a DOE issued permit 
within ninety (90) calendar days from submission of complete documentary 
requirements. Concomitantly, the DOE may require from any midstream natural 
gas industry participant with a DOE issued permit the prior disclosure of any 
sale, assignment, or transfer or ownership or direct or indirect interests, rights, 
or participation not amounting to control to another entity. In both these cases, 
the DOE may review, modify, cancel, approve, or disapprove any permit it has 
issued taking into consideration the legal, technical, and financial qualifications 
of the purchaser, assignee, or transferee and its compliance with its own use or 
rTPA permit or other DOE issued permits under this Act and existing laws, rules 
and regulations;
(o) 
Determine the qualifications of and procedure for the competitive selection of a 
single independent NGTSO taking into consideration Section 21 of this Act, 
upon consultation with relevant government agencies, midstream natural gas
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industry participants, and other public and private stakeholders, and undertake 
its selection upon the interconnection of natural gas transmission systems;
(p) 
Require the submission of the following information from suppliers, importers, 
aggregators, and owners and operators of LNG terminals, storage facilities, and 
bunkering facilities, whichever is applicable, subject to Section 31 of this Act:
(1) 
Progress and status report on the location, construction, improvement, 
operation, expansion modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of LNG terminals and storage and 
bunkering facilities;
(2) 
Regular reports on the following: (i) compliance with health, safety, 
security, and environmental standards; (ii) utilization of the LNG terminal 
by its owner and operator, their affiliates, and third parties, whichever is 
applicable; and (iii) compliance with the LNG Terminal Regulated Third 
Party Access Code to include compliance with DOE directive to subject an 
unutilized capacity to regulated third party access;
(3) 
Supply and demand of natural gas with respect to their own facilities or 
operations;
(4) 
Volumes of specific inventories to include levels of importation and 
emergency reserve;
(5) 
Progress and status report on mitigation measures and responses in 
relation to accidents and other emergency incidents;
(6) 
Mode of competitive selection of third parties for rTPA LNG terminal 
permit holders, reports on competitive selection processes undertaken, 
and status of utilization by third parties of the LNG terminal with an rTPA 
permit: Provided, That each competitive selection process shall be 
transparent, fair, reasonable, and non-discriminatory; and
(7) 
Other data and information necessary to the performance of the duties 
and functions of DOE;
(q) 
Determine the necessity of, and then direct the interconnection of natural gas 
transmission systems based on the Philippine Energy Plan, Midstream Natural 
Gas Development Plan, and the Natural Gas Transmission Development Plans, 
taking into consideration the maturity of the industry, the existing natural gas 
transmission systems’ infrastructures, and the cost efficiency of 
interconnection, and upon consultation with the ERC, other relevant 
government agencies, midstream natural gas industry participants, and other 
public and private stakeholders;
(r) 
Ensure compliance with the publication and unbundling of the terminal fee in 
accordance with Section 24 of this Act;
(s) 
Ensure and review compliance with, and investigate, motu proprio or upon 
complaint, any non-compliance with this Act, including any permit DOE has
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issued in relation hereto, its rules and regulations, the LNG Terminal Regulated 
Third Party Access Code, and any other issuance promulgated pursuant to the 
DOE’S powers under this Act, except those under the jurisdiction of the ERC as 
provided under Section 6 herein. Thereafter, the DOE may penalize, suspend, 
or revoke, after due notice and hearing any permit it has issued;
(t) 
Endorse the findings of investigations against midstream natural gas industry 
participants, for (1) anticompetitive behavior before the Philippine Competition 
Commission (PCC); or (2) violations of the provisions of this Act and other 
applicable laws, rules, and regulations before the ERC, other quasi-judicial 
agencies, or the courts; and
(u) 
Perform all other acts that are analogous to the foregoing and in furtherance of 
the implementation of this Act.
SEC. 6. Powers and Responsibilities of the Energy Regulatory
Commission (ERC). - In addition to its functions under Republic Act No. 9136,
otherwise known as the Electric Power Industry Reform Act of 2001, the ERC shall
have the authority to;
(a) 
Promulgate the PNS of and identify and adopt other international standards 
adopted as PNS by the DTI-BPS, together with relevant government agencies 
and upon consultation with midstream natural gas industry participants and 
other public and private stakeholders, within eighteen (18) months from the 
effectivity of the implementing rules and regulations of this Act for the (1) 
dedicated natural gas pipelines, and (2) natural gas transmission systems;
(b) 
Ensure compliance with the health, safety, security, and environmental 
standards of (1) dedicated natural gas pipelines, and (2) natural gas 
transmission systems, together with the Department of Environment and 
Natural Resources (DENR), Department of Health (DOH), Department of Labor 
and Employment (DOLE), and other relevant government agencies;
(c) 
Participate in the technical working group convened by the DOE pursuant to 
Section 5 of this Act;
(d) 
Evaluate and act on applications for the location, construction, improvement, 
operation, utilization, expansion, modification, rehabilitation, repair, 
maintenance, decommissioning, and abandonment of dedicated natural gas 
pipelines and natural gas transmission systems;
(e) 
Issue permits for the transmission of natural gas to include certificates of public 
convenience and necessity (CPCN) to natural gas transmission utilities;
(f) 
Establish a methodology and timeframe for the determination of the unutilized 
capacity of natural gas transmission systems, which shall be integrated in the 
Transmission Regulated Third Party Access Code, taking into consideration the 
(1) reasonable period to use the capacity, (2) existing market demand, and (3) 
existing contracts;
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(g) 
Promulgate the national Gas Transmission Code and Transmission Regulated 
Third Party Access Code within one (1) year from the effectivity of the 
implementing rules and regulations of this Act, and upon consultation with other 
relevant government agencies, midstream natural gas industry participants, and 
other public and private stakeholders, and ensure compliance therewith. The 
Natural Gas Transmission Code and the Transmission Regulated Third Party 
Access Code which shall be reviewed and updated regularly. The creation of 
these codes shall be governed by the following: (1) reliable and continuous 
supply of natural gas, and (2) transparent, fair, reasonable, and non- 
discriminatory use and access;
(h) 
Declare the unutilized capacity of a natural gas transmission system and 
mandate regulated third party access for such in accordance with the 
Transmission Regulated Third Party Access Code;
(i) 
Determine minimum guidelines to ensure the transparent, fair, reasonable, and 
non-discriminatory conduct of competitive selection processes by natural gas 
transmission utilities: Provided, That these minimum guidelines shall not 
include the mode of competitive selection process;
G) Approve or disapprove any plan of a natural gas transmission utility, an owner 
and operator of a dedicated natural gas pipeline, and the NGTSO to sell, 
assign, or transfer control to another entity. For this purpose, the ERC shall 
require from natural gas transmission utility, the owner and operator of a 
dedicated natural gas pipeline, and the NGTSO the prior disclosure of any sale, 
assignment, or transfer of ownership or direct or indirect interests, rights, or 
participation to another entity. In all cases, the ERC shall have the power to 
review, modify, cancel, approve, or disapprove any permit it has issued taking 
into consideration the legal, technical, and financial qualifications of the 
purchaser, assignee, or transferee and its compliance with the conditions 
attached to the permits issued by ERC pursuant to this Act and existing laws, 
rules, and regulations;
(k) Require the submission of the following information from the owner and 
operator of dedicated natural gas pipelines, the natural gas transmission utility, 
and the NGTSO, whichever is applicable, subject to Section 31 of this Act:
(1) 
Progress and status reports on the location, construction, improvement, 
operation, expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of dedicated natural gas pipelines, 
natural gas transmission systems, and the interconnected natural gas 
transmission system,
(2) 
Regular reports on the following:
(i) 
Utilization of the dedicated natural gas pipeline and natural gas 
transmission system by its owner and operator, their affiliates, and 
third parties, whichever is applicable,
(ii) 
Compliance with the Transmission Regulated Third Party Access 
Code to include compliance with DOE directive to subject an 
unutilized capacity to regulated third party access;
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(Hi) Supply and demand of natural gas with respect to their own facilities 
or operations,
(iv) Volumes of specific inventories to include levels of ancillary reserve, 
when applicable,
(v) 
Compliance with health, safety, security, and environmental 
standards, and activities in relation thereto,
(vi) 
Progress and status reports on mitigation measures and responses 
in relation to accidents and other significant or emergency incidents,
(vii) 
Mode of competitive selection of third parties for natural gas 
transmission utilities, reports on competitive selection processes 
undertaken to include the natural gas transmission fee, and status of 
utilization by third parties; Provided, That the mode for each 
competitive selection process shall be determined by each natural 
gas transmission utility: Provided further, That each competitive 
selection process shall be transparent, fair, reasonable, and non- 
discriminatory
(viii) Billed and collected amounts of the natural gas transmission fee and 
NGTSO fee, whichever is applicable, and
(ix) Other documents, data, and information necessary to the performance 
by ERC of its functions under this Act;
(l) 
Ensure and review compliance with, and investigate, motu proprio, upon 
complaint or upon endorsement of any government agency, any non- 
compliance with this Act including any permit ERC has issued in relation 
hereto, its rules and regulations, the Natural Gas Transmission Code, the 
Transmission Regulated Third Party Access Code, and any other issuance 
promulgated pursuant to the ERC’s powers under this Act, except those under 
the jurisdiction of the DOE as provided under Section 5 herein. Thereafter, the 
ERC may penalize, suspend, or revoke, after due notice and hearing any 
permit it has issued;
(m) Endorse the findings of investigation on any anticompetitive behavior of an 
owner and operator of a dedicated natural gas pipeline, the natural gas 
transmission utility, and the NGTSO to the PCC;
(n) 
Exercise its rate-setting power through the determination and regular review of 
the (i) reserve price for the natural gas transmission fee, which shall remain 
undisclosed until the winning bidder is declared, and (ii) NGTSO fee. The ERC 
shall notify and afford relevant stakeholders the opportunity to be heard in the 
(i) methodology for the determination of the reserve price, and (ii) determination 
of the NGTSO fee;
(0) Ensure compliance with the publication and unbundling of the natural gas 
transmission fee and the NGTSO fee imposed by natural gas transmission 
utilities, and the NGTSO respectively, in accordance with Section 24 of this Act;
(p) Review regularly the performance of natural gas transmission utilities and the 
NGTSO, when applicable, including the quality of its service and compliance 
with its approved Natural Gas Transmission Development Plan and its powers 
and function pursuant to Chapter V of this Act;
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(q) 
Exercise exclusive jurisdiction over all matters pertaining to rate setting in this 
Act taking into consideration the policy of full recovery of prudent and 
reasonable economic costs with a reasonable rate of return or such other 
principles that promote efficiency and other internationally accepted rate setting 
methodology.
(r) 
Exercise overall regulatory supervision over dedicated natural gas pipelines, 
natural gas transmission systems, and the NGTSO; and
(s) 
Perform all other acts are analogous to the foregoing and the furtherance of the 
implementation of this Act.
SEC. 7. Powers and Responsibilities of the Department of Environment 
and Natural Resources. - In addition to its functions under Executive Order No. 
192, otherwise known as the Reorganization Act of the Department of Environment 
and Natural Resources, and other applicable laws, the DENR, together with the DOE, 
the ERC, and/or the DOTr, shall ensure and monitor compliance with the 
environmental standards for the location, construction, improvement, operation, 
utilization, expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of LNG terminals, natural gas transmission 
systems, dedicated natural gas pipelines, storage facilities, bunkering facilities, 
virtual pipelines, and motor vehicles and marine vessels transporting, storing or 
processing natural gas, in its original state or liquefied form, and all related 
equipment and facilities.
SEC. 8. Powers and Responsibilities of the Department of Health. - In
addition to its functions under Executive Order No. 317, Series of 1941, entitled 
Organizing the Department of Health and Public Welfare, as amended, and Republic 
Act No. 11223, otherwise known as the Universal Health Care Act, the DOH, 
together with the DOE, ERC, DOLE and/or the DOTr, shall:
(a)
(b)
(c)
(d)
Ensure and monitor compliance with the health standards, including 
occupational safety and health standards, for the location, construction, 
improvement, operation, utilization, expansion, modification, rehabilitation, 
repair, maintenance decommissioning, and abandonment of LNG terminals, 
natural gas transmission systems, dedicated natural gas pipelines, and motor 
vehicles and marine vessels transporting, storing, or processing natural gas, in 
its original state or liquefied form, and all related equipment and facilities;
Recommend standards, rules, and regulations in the conduct of health risk 
assessment studies in cases of natural gas accidents;
Develop guidelines, policies, and health standards on the treatment and 
management of patients affected by natural gas accidents; and
Require health data and information from LNG terminals, natural gas 
transmission systems, dedicated natural gas pipelines, storage facilities, and 
bunkering facilities, virtual pipelines, and motor vehicles and marine vessels
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transporting, storing, or processing natural gas, in its original state or liquefied 
form, and all related equipment and facilities.
SEC. 9. Powers and Responsibilities of the Department of Trade and 
Industry - Bureau of Philippine Standards. - In addition to its functions under 
Republic Act No. 4109, otherwise known as the Standards Act, the DTI-BPS, shall 
act as the Co-Chairperson of the technical working group created pursuant to 
Section 5 of this Act, and together with the DOE, the ERC, and the DOTr, determine, 
develop, formulate, promulgate, and revise the Philippine National Standards, or 
identify and adopt international standards as PNS for natural gas in its original or 
liquefied form, LNG terminals, dedicated natural gas pipelines, natural gas 
transmission systems, storage facilities, bunkering facilities, virtual pipelines, and 
motor vehicles and marine vessels transporting, storing, or processing natural gas, in 
its original state of liquefied form, and all related equipment and facilities.
SEC. 10. Powers and Responsibilities of the Department of 
Transportation and its Attached Agencies. - In addition to its functions under 
Executive Order No. 125, Series of 1987 otherwise known as Reorganizing the 
Ministry of Transportation and Communications, Defining its Powers and Functions 
and for Other Purposes, as amended, and other applicable laws, the DOTr and its 
attached agencies, such as the Land Transportation Office (LTO), Land 
Transportation Franchising and Regulatory Board (LTFRB), and Maritime Industry 
Authority (MARINA), in coordination with the DOE, DENR, DOH, DTI-BPS, and other 
relevant government agencies, shall issue the appropriate guidelines and regulations, 
and the applicable permits, licenses, certificates, or authorizations to virtual pipelines, 
motor vehicles and marine vessels transporting, storing, or processing natural gas in 
its original sate of liquefied form, as well as marine facilities used to import, receive, 
unload, load, transport, process, and store natural gas in its original or liquefied form, 
including those utilized as offshore LNG terminals. The DOTr shall also monitor and 
ensure compliance with the appropriate laws, rules and regulations issued for the 
purpose.
SEC. 11. Powers and Responsibilities of the Philippine Competition 
Commission (PCC). - In addition to its functions under Republic Act No. 10667, 
otherwise known as the Philippine Competition Act, the PCC shall exercise primary 
and exclusive jurisdiction over any anticompetitive behavior of midstream natural gas 
industry participants.
CHAPTER III
MIDSTREAM NATURAL GAS INDUSTRY PARTICIPANTS
SEC. 12. Responsibilities of Midstream Natural Gas Industry Participants.
- All midstream natural gas industry participants shall:
(a) Adhere to all health, safety, security and environmental standards and all 
codes, rules, regulations, and issuances promulgated pursuant to Chapter II of 
this Act;
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(b) 
Comply with all obligations and responsibilities under this Act to include 
reportorial requirements and submissions pursuant to Chapter II of this Act;
(c) 
Participate as a member of the technical working group pursuant to Section 5 of 
this Act;
(d) 
Unbundle their respective fees, if applicable, pursuant to Sections 5, 6, and 24 
of this Act; and
(e) 
Not engage in any anticompetitive behavior.
CHAPTER IV 
LNG TERMINALS
SEC 13. Importation and Receipt of Natural Gas through LNG Terminals.
- Imported natural gas, in its liquefied form, shall only be received, unloaded, loaded, 
processed, stored, transmitted, transported, and conveyed in accordance with this 
Act.
SEC. 14. Safety and Exclusion Zone. - All LNG terminals shall have a 
safety and exclusion zone to be determined by the DOE in consultation with the 
technical working group created under Section 5 of this Act, and other relevant 
stakeholders from the public and private sectors.
SEC. 15. LNG Terminal Owner and Operator. - An LNG terminal may have 
a separate owner and operator. If the LNG terminal owner and operator are separate 
entities, they shall be treated as one and the same entity insofar as permits, licenses, 
certificates, and authorizations are concerned, as well as in the exercise of rights 
and compliance with obligations, standards, regulations, and other relevant laws and 
issuances.
SEC. 16. Use and Access of LNG Terminals. - The use and access of LNG 
terminals shall be regulated pursuant to this Act, while the terminal fee shall be 
unbundled in accordance with Section 24 and unregulated. All owners and operators 
of LNG terminals shall annually submit their LNG Terminal Development Plan to 
DOE pursuant to Section 5 of this Act.
The DOE shall issue own use and rTPA permits to owners and operators of 
LNG terminals. Such owners and operators shall have the option to apply for and 
hold an own use permit, an rTPA permit, or both permits simultaneously for each 
LNG terminal, and perform the functions of an own use LNG terminal permit holder 
pursuant to Section 17 of this Act and an rTPA LNG terminal permit holder pursuant 
to Section 18 of this Act, to the extent of the capacity allowed by and during the 
length of the time specified in each type of permit, and in accordance with the LNG 
Terminal Regulated Third Party Access Code.
Each type of permit shall specify the capacity and length of time covered by 
the permit; Provided, That the total capacity of all permits held by an owner and 
operator of an LNG terminal for each LNG terminal shall not exceed the maximum
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capacity of such LNG terminal. The unutilized capacity of an owner and operator or 
its affiliate covered by an own use LNG terminal permit shall be opened to third 
parties through the issuance of an rTPA permit and pursuant to the LNG Terminal 
Regulated Third Party Access Code. The unutilized capacity by a third party covered 
by an rTPA LNG terminal permit shall be opened to other third parties pursuant to 
the LNG Terminal Regulated Third Party Access Code.
SEC. 17. Own Use LNG Terminal. - An own use LNG terminal permit holder
shall:
(a) 
Exclusively utilize the capacity allowed by and during the length of time 
specified in the own use permit, and may allow its affiliates to do the same; and
(b) 
Not enter into an nTPA or any similar arrangement with third parties or 
otherwise grant use and access of its facilities to such third parties to the extent 
of the capacity allowed and during the length of time specified in the own use 
permit, subject to Section 16 of this Act and the LNG Terminal Regulated Third 
Party Access Code.
SEC. 18. Regulated Third Party Access LNG Terminal. - The issuance of 
an rTPA permit to an owner and operator of an LNG terminal shall take into 
consideration the capacity and utilization of the LNG terminal, current midstream end 
users, existing market conditions, and other relevant information with the end in view 
of enabling competition in the natural gas industry. The use and access of the 
capacity covered by an rTPA permit shall be open to all third parties subject to the 
payment of a terminal fee. An rTPA LNG terminal permit holder shall:
(a) 
Publicly disclose the capacity available to and utilization by third parties in 
accordance with the reportorial requirements under this Act and the LNG 
Terminal Regulated Third Party Access Code;
(b) 
Determine the mode of competitive selection of third parties: Provided, That 
each LNG terminal shall determine its own competitive selection process which 
shall be transparent, fair, reasonable, and non-discriminatory, subject to the 
reportorial requirements under this Act;
(c) 
Not give any undue preference or advantage to any third party, whether in 
rates, terms, conditions, or special privileges.
CHAPTER V
TRANSPORT AND TRANSMISSION OF NATURAL GAS
SEC. 19. Transport of Natural Gas. - Natural gas, in its original or liquefied 
form, may be transported within the country through virtual pipelines, motor vehicles, 
and marine vessels in accordance with this Act. The use, access, and fees for the 
transportation of natural gas shall be unregulated but shall be subject to the permits, 
licenses, certificates, authorizations, standards, regulations, and guidelines 
promulgated pursuant to Chapter II of this Act.
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SEC. 20. Transmission of Natural Gas. - Natural gas may be transmitted 
through dedicated natural gas pipelines or natural gas transmission systems either 
from an LNG terminal or local natural gas production facility.
SEC. 21. Dedicated Natural Gas Pipelines. - The ownership and operation 
of a dedicated natural gas pipeline shall not be considered a public utility and shall 
not require a legislative franchise, but shall require a permit in accordance with 
Section 6 of this Act. Its use, access, and fee for use shall be unregulated, but shall 
be subject to permits, licenses, certificates, authorizations, standards, regulations, 
guidelines, codes, and reportorial requirements as provided in this Act. The owner 
and operator of a dedicated natural gas pipeline shall:
(a) 
Exclusively utilize the capacity of its dedicated natural gas pipeline or allow its 
affiliates to do the same;
(b) 
Not enter into an nTPA or any similar arrangement with third parties or 
otherwise grant use and access of its facilities to such third parties; and
(c) 
Inform the ERC of its intent to convert its facilities to a natural gas transmission 
system simultaneous with its application for a legislative franchise as a natural 
gas transmission utility.
SEC. 22. Natural Gas Transmission Systems. - The use, access, and 
terminal fee of a natural gas transmission system shall be regulated. The ownership 
and operation of a natural gas transmission system shall be considered a public 
utility and shall require a legislative franchise. The issuance of a CPCN to a natural 
gas transmission utility shall take into consideration its legal, technical, and financial 
capability.
The use and access to the entire capacity of a natural gas transmission 
system shall be open to all third parties for a natural gas transmission fee, subject to 
the reserve price of the ERC in accordance with Section 6 of this Act: Provided, That 
in the case of a dedicated natural gas pipeline that converts its facilities into a natural 
gas transmission system, existing contracts with affiliates for the use of the pipeline 
at the time of the effectivity of such franchise shall be allowed to continue until the 
end of the contract, which shall not be subject to any extension.
A natural gas transmission utility shall:
(a) 
Regularly disclose to the public the capacity available for, and utilization by 
third parties in accordance with the reportorial requirements under this Act and 
the Transmission Regulated Third Party Access Code;
(b) 
Determine the mode of, and conduct a competitive selection of third parties: 
Provided, That each natural gas transmission utility shall determine its own 
competitive selection process which shall be transparent, fair, reasonable, and 
non-discriminatory, subject to the reportorial requirements under this Act;
(c) 
Ensure that the winning bid does not go beyond the reserve price determined 
by ERC pursuant to Section 6 of this Act;
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(d) 
Provide transparent, fair, reasonable, and non-discriminatory use and access to 
third parties;
(e) 
Not give any undue preference or advantage to any third party, whether in 
rates, terms, conditions, or special privileges;
(f) 
Submit annually its Natural Gas Transmission Development Plant to DOE for 
review and approval, or the NGTSO, whichever is applicable, pursuant to 
Sections 5 and 23 of this Act;
(g) 
Assign to the NGTSO the operation and maintenance of its natural gas 
transmission system upon direction of the ERC after the interconnection of 
natural gas transmission systems and the selection of the NGTSO; and
(h) 
When applicable, inform and coordinate with NGTSO for the location, 
construction, improvement, operation, utilization, expansion, modification, 
rehabilitation, repair, maintenance, decommissioning, and abandonment of any 
part of the natural gas transmission system to be undertaken in accordance 
with its submitted National Gas Transmission Development Plan.
SEC. 23. Natural Gas Transmission System Operator. - The DOE, based 
on the Philippine Energy Plan, the Midstream Natural Gas Industry Development 
Plan, and the various Natural Gas Transmission Development Plans shall determine 
the necessity of, and then direct, the interconnection of natural gas transmission 
systems pursuant to Section 5 of this Act. The DOE shall thereafter select a single 
independent NGTSO.
The NGTSO shall not be an affiliate of any LNG terminal owner and operator, 
natural gas transmission utility, or any midstream end-user. The NGTSO shall:
(a) 
Operate and manage the interconnected natural gas transmission system in 
accordance with the Natural Gas Transmission Code and Transmission 
Regulated Third Party Access Code;
(b) 
Coordinate with natural gas transmission utilities for the location, construction, 
improvement, operation, utilization, expansion, modification, rehabilitation, 
repair, maintenance, decommissioning, and abandonment of any part of the 
natural gas transmission system in accordance with their submitted Natural 
Gas Transmission Development Plan;
(c) 
Furnish midstream natural gas industry participants with sufficient information 
for the efficient access to the interconnected natural gas transmission system;
(d) 
Procure ancillary services necessary to support the reliable and continuous flow 
of natural gas through the interconnected natural gas transmission system;
(e) 
Annually prepare a comprehensive Natural Gas Transmission Development 
Plan based on the submitted Natural Gas Transmission Development Plans of 
natural gas transmission utilities, upon consultation with public and private 
stakeholders, and submit the same for review and approval of the DOE;
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(f) 
Collect an NGTSO fee, subject to the approval of the ERC; and
(g) 
Perform such other functions and responsibilities determined by the DOE and 
the ERC pursuant to Sections 5 and 6 of this Act.
CHAPTER VI
RATES, FEES, AND OTHER CHARGES
SEC. 24. Publication and Unbundling of Fees. - LNG terminals with 
regulated third party access, whether through an rTPA permit or a DOE declaration 
of an unutilized capacity, natural gas transmission utilities, and the NGTSO shall 
identify and segregate in their bills to midstream end-users the component of their 
terminal fees, natural gas transmission fees, and NGTSO fee, respectively, and 
publish the same on their website.
SEC. 25. Other Fees and Charges. - The DOE, ERC, and other relevant 
government agencies may impose reasonable fees for the processing of applications 
and permits required under this Act pursuant to Executive Order No. 292, otherwise 
known as the Administrative Code of 1987, and Republic Act No. 9136 otherwise 
known as the Electric Power Industry Reform Act of 2001.
CHAPTER VII
PROHIBITED ACTS AND PENALTIES
SEC. 26. Prohibited Acts. - Without prejudice to civil and criminal liability, 
the following acts shall be prohibited:
(a) 
For government agencies: failing to comply with the responsibilities under 
Chapter II of this Act, and within the timeframe specified in Sections 5, 6, and 
36 of this Act;
(b) 
For midstream natural gas industry participants:
(1) Engaging in activities without the required permits, licenses, certificates, 
and authorizations under this Act, specifically:
(i) 
Engaging in the aggregation, supply, importation, exportation, 
receipt, unloading, loading, processing, storage, regasification, 
transmission, bunkering, and transportation of natural gas, or the 
location, construction, improvement, operation, utilization, 
expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of an LNG terminal, natural gas 
transmission system, dedicated natural gas pipeline, virtual pipeline, 
and motor vehicles and marine vessels transporting natural gas 
without a permit as required under this Act from the DOE, ERC, and 
DOTr and/or its attached agencies;
(ii) 
Engaging in any activity as a midstream natural gas industry 
participant without a license, certificate, and authorization from the
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DENR, DOH, Department of Interior and Local Government (DILG) 
or its attached agencies, LGUs, and other relevant government 
agencies:
(iii) 
Operating as an own use terminal without an own use permit;
(iv) 
Operating as an rTPA terminal without an rTPA permit; and
(v) 
Operating a natural gas transmission system without a legislative 
franchise and a CPCN;
(2) Failure to comply with health, safety, security, and environmental 
standards, requirements, and guidelines as well as codes under this Act 
and other applicable laws, including the provisions of Republic Act No. 
11058, otherwise known as the Occupational Safety and Health Law, 
whichever is applicable, specifically:
(i)
Failure to comply with the PNS of other international standards 
adopted as PNS of the following:
A. Natural gas, in its original or liquefied form.
Location, construction, improvement, operation, utilization, 
expansion, modification, rehabilitation, repair, maintenance, 
decommissioning, and abandonment of all LNG terminals. 
Storage and bunkering of natural gas and its respective 
facilities.
Virtual pipelines,
Motor vehicles and marine vessels transporting natural gas. 
Dedicated natural gas pipelines, and 
Natural gas transmission systems
B.
C.
D.
E.
F.
G.
(ii)
Failure to comply with the standards, rules, and regulations in the 
conduct of health risk assessment studies in cases of natural gas 
accidents:
(iii) 
Failure to comply with the Natural Gas Transmission Code;
(iv) 
Failure to comply with the LNG Terminal Regulated Third Party 
Access Code;
(v) 
Failure to comply with the Transmission Regulated Third Party 
Access Code; and
(vi) 
Failure to comply with the safety and exclusion zone;
(3) Failure to submit or disclose required data, information, and documents, 
whichever is applicable, specifically:
(i) 
Failure to submit an LNG Terminal Development Plan;
(ii) 
Failure to submit a Natural Gas Transmission Development Plan;
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(iii) 
Refusal or failure to submit the required data and information to the 
DOE pursuant to Section 5 of this Act;
(iv) 
Refusal or failure to submit the required documents, data, and 
information to the ERC pursuant to Section 5 of this Act;
(v) 
Refusal or failure to submit health data and information to the DOH 
and other applicable agencies, pursuant to Section 8 of this Act;
(vi) 
Refusal or failure to disclose the (A) capacity available to third 
parties, and (B) utilization of capacities by third parties,
(vii) Failure to furnish midstream natural gas industry participants with 
sufficient information for efficient access to the interconnected 
natural gas transmission system, and
(viii) Failure to inform the ERC of its intent to convert a dedicated natural 
gas pipeline to a natural gas transmission system simultaneous with 
its application for a legislative franchise;
(4) 
Failure to comply with the requirements on fees, whichever is applicable,
specifically:
(i) 
Failure to comply with the publication and unbundling requirement 
for the terminal fee, natural gas transmission fee, and NGTSO fee, 
whichever is applicable,
(ii) 
Collecting an NGTSO fee without the approval of ERC;
(iii) 
Awarding a winning bid beyond the reserve price determined by the 
ERC;
(iv) 
Collecting a natural gas transmission fee higher than the winning bid; 
and
(v) 
Disclosing the reserve price before the determined time by the ERC;
(5) 
Failure to comply with the requirements on own use and regulated third
party access, whichever is applicable, specifically:
(i) 
Allowing a third party to use a portion or the entire capacity of a 
dedicated natural gas pipeline;
(ii) 
Entering into an nTPA or a similar arrangement with third parties or 
granting the use and access to third parties to the extent of the 
capacity covered by an own use permit for LNG terminals;
(iii) 
Refusal or failure to conduct a transparent, fair, reasonable, and 
non-discriminatory competitive selection of third parties for the 
capacity covered by an rTPA permit for LNG terminals, or the entire 
capacity of a natural gas transmission system;
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(iv) 
Using or allowing an affiliate to use the capacity covered by an rTPA 
permit for LNG terminals or a portion of the entire capacity of a 
natural gas transmission system without undergoing a competitive 
selection process;
(v) 
Giving any undue preference or advantage to any third party, 
whether in rates, terms, conditions, or special privileges;
(vi) 
Failure to provide transparent, fair, reasonable, and non- 
discriminatory use and access to third parties; and
(vii) Failure to comply with mandated regulated third party access for 
unutilized capacity;
(6) Failure to comply with other responsibilities as midstream natural gas
industry participants, whichever is applicable, specifically:
(i) 
Refusal to participate as an identified member of the technical 
working group;
(ii) 
Failure to cooperate in any investigation conducted by the DOE, 
ERC, or PCC pursuant to their powers under this Act;
(iii) 
Failure to comply with the prior approval requirement of any sale, 
assignment, or transfer of control of a midstream natural gas industry 
participant with a DOE issued permit to another entity;
(iv) 
Failure to comply with the requirement for prior disclosure of any 
sale, assignment, or transfer of ownership or direct or indirect 
interests, rights, or participation of a midstream natural gas industry 
participant with a DOE issued permit to another entity;
(v) 
Engaging in anti-competitive behavior;
(vi) 
Refusal or failure to assign to the NGTSO the operation and 
maintenance of its natural gas transmission system upon directive of 
the ERC;
(vii) Refusal or failure to inform and coordinate with the NGTSO or the 
natural gas transmission utilities, whichever is applicable, for the 
location, construction, development, operation, utilization, expansion, 
modification, rehabilitation, repair, maintenance, decommissioning, 
and abandonment of any part of the natural gas transmission 
system;
(viii) Failure to secure ancillary services necessary to support reliable and 
secure flow of natural gas through the interconnected natural gas 
transmission system; and
(ix) Failure to comply with other responsibilities otherwise stated in this 
Act.
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SEC. 27. Penalties. - Without prejudice to any civil and criminal liability, the 
following administrative penalties shall be imposed upon any natural or juridical 
person:
(a) 
For violation of Section 26(a) of this Act: A fine not exceeding the equivalent of 
six (6) month’s salary or suspension not exceeding one (1) year, or removal 
depending on the gravity of the offense;
(b) 
For violation of Section 26(b) of this Act:
(1) 
First offense: Fine of not less than Five hundred thousand pesos 
(P500,000) for every day of non-compliance, and if applicable, suspension 
of permits, licenses, certificates, or authorizations until the violation is 
corrected,
(2) 
Second offense: Fine of not less than One million pesos (P1,000,000) for 
every day of non-compliance, and if applicable, suspension of permits, 
licenses, certificates, or authorizations until the violation is corrected; and
(3) 
Third offense: Fine of not less than Five million pesos (P5,000,000), 
revocation of permits, licenses, certificates, or authorizations, and 
disqualification from applying for future permits, licenses, certificates, or 
authorizations. In the case of natural gas transmission utilities, the DOE 
and ERC shall recommend the revocation of their respective franchise to 
Congress. In the case of the NGTSO, it shall be replaced: Provided, That 
the administrative penalty for violations of Section 26 (b)(vi)(5) shall be 
pursuant to Section 28 of the Philippine Competition Act.
CHAPTER VIII 
FINAL PROVISIONS
SEC. 28. Incentives. - LNG terminals, storage facilities, bunkering facilities, 
dedicated natural gas pipelines, and natural gas transmission systems shall be 
included in the Strategic Investment Priority Plan subject to an evaluation process. 
For this purpose, these investments shall be entitled to the incentives and for the 
length of time provided under Executive Order No. 226, otherwise known as the 
Omnibus Investments Code of 1987, as amended by Republic Act No. 11534, 
otherwise known as the Corporate Recovery and Tax Incentives for Enterprises Act, 
and other applicable laws.
SEC. 29. Permits and Licenses. - All permits, licenses, certificates, and 
authorizations issued pursuant to this Act shall be streamlined and shall be covered 
by Republic Act No. 11234, otherwise known as the Energy Virtual One-Stop Shop 
Act, except for those whose frames are expressly provided herein.
SEC. 30. Public Access to Information. - The DOE, ERC, and other 
relevant government agencies shall allow public access, through its website or other 
applicable means, to all data and information submitted in the implementation of this 
Act: Provided, That such access is compliant with Section 31 hereto.
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SEC. 31. Treatment of Confidential Information. - The DOE, ERC, and 
relevant government agencies shall not disclose any proprietary and confidential 
information to the public and to other midstream natural industry participants unless 
prior consent of the source or owner of such information has been obtained by the 
requesting party: Provided, That prior consent shall not be required if the proprietary 
and confidential information is requested by a government agency and the request is 
made in the performance of governmental functions: Provide further, That the 
requesting government agency shall not disclose the proprietary and confidential 
information to the public and to other midstream natural gas participants.
SEC. 32. Establishment of Dedicated Offices. - The DOE and the ERC
shall establish dedicated bureaus or offices for the effective implementation of this 
Act. The organizational structure and staffing complement shall be determined by the 
Secretary of Energy and the Chairperson of the ERC, as appropriate, with approval 
of the Department of Budget and Management (DBM) and in accordance with 
existing civil service rules and regulations.
SEC. 33. Appropriations. - The amount of Seventy-five million pesos 
(P75,000,000) shall be charged against the current year’s appropriations of the DOE, 
while the amount of Seventy million pesos (P70,000,000) shall be charged against 
the current year’s appropriations of the ERC, for the initial implementation of this Act. 
Thereafter, such amounts necessary for the effective implementation of this Act shall 
be included in the annual General Appropriation Act.
SEC. 34. Congressional Oversight. - The Joint Congressional Energy 
Commission (JCEC) shall exercise oversight powers over the implementation of this 
Act. The DOE, ERC, and other relevant government agencies shall submit annual 
reports to the JCEC not later than the fifteenth day of September, which shall include 
the latest relevant data, implementation review and reports, and policy and 
regulatory issuances, and such other relevant information.
SEC. 35. Transitory Period.-AW midstream natural gas industry participants 
shall comply with the provisions of this Act within five (5) years from its effectivity: 
Provided, That health, safety, security, environmental, construction, operation and 
other permits, licenses, certificates, and authorizations issued prior to the effectivity 
of this Act which are not inconsistent herewith shall remain valid.
Natural gas transmission systems existing at the time of the effectivity of this 
Act shall be allowed to continue pursuant to the terms and conditions indicated in 
their franchises and until the lapse of the period accorded to them in the franchise.
SEC. 36. Implementing Rules and Regulations. - The DOE and ERC, in 
consultation with the relevant government agencies, and public and private 
stakeholders, shall issue the implementing rules and regulations (IRR) of this Act 
within six (6) months from its effectivity.
SEC. 37. Separability Clause. - Any provision of this Act, which may be 
declared unconstitutional or invalid, shall not have the effect of nullifying other 
portions of provision hereof.
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Sec. 38. Amendatory and Repealing Clause. - The specific provisions of 
Republic Act No. 387, otherwise known as the Petroleum Act of 1949, and 
Presidential Decree No. 334, Creating the Philippine National Oil Company, Defining 
its Powers and Functions, Providing Funds Therefor, and For Other Purposes that 
are inconsistent with this Act are hereby amended or repealed accordingly.
All other laws, ordinances, rules, regulations and issuance or parts thereof, 
that are inconsistent with this Act, are likewise amended or repealed accordingly.
SEC. 39. Effective Clause. - This Act shall take effect fifteen (15) days after 
its publication in the Official Gazette or in one (1) newspaper or general circulation.
Approved,
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