EIGTHEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES
First Regular Session
SENATE
S.B. NO. 990
Introduced by Senator Maria Lourdes Nancy S. Binay
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AN ACT
TO 
STRENGTHEN 
THE 
JURISDICTION 
AND 
POWER 
OF 
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
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. 
Flowever, 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.
7^u J L
MARIA LOURDES NAWCY S. BINAY 
Senator


EIGHTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES
First Regular Session
S.B. NO.
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.....
Introduced by Senator Maria Lourdes Nancy S. Binay
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AN ACT
TO 
STRENGTHEN 
THE 
JURISDICTION 
AND 
POWER 
OF 
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 o f Representatives o f the Philippines in 
Congress assembled:
CHAPTER I
GENERAL PROVISION
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Section 1. Short Title. -  This Act shall be known as the "Philippine Pipeline
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Act of 2019".
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to:
Sec. 2. Declaration o f Policy. -  It is hereby declared the policy of the State
(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;


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(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 transporting petroleum, especially to urban 
areas.
Sec. 3. Scope and Application. Except as otherwise provided herein, this 
Act shall apply to all existing and future petroleum pipelines in the country.
Sec. 4. Definition o f Terms. -  As used in this Act, the following terms
shall;
a) Act -  shall refer to the Philippine Pipeline Act of 2017;
b) Concession -  shall refer to the authority granted to a Person for the 
right to own, establish, provide, construct, install, operate and 
maintain Petroleum Pipeline systems for transporting Petroleum 
Products;
c) Contract of Concession -  shall refer to the agreement executed 
between the DOE on behalf of the Government of the Republic of 
the Philippines and a Pipeline Operator granting a Pipeline 
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 of Interior and Local 
Government;
f) DOE -  shall refer to the Department of Energy;
g) DOH -  shall refer to the Department of Health;
h) DOTr -  shall refer to the Department of Transportation;
i) DPWH -  shall refer to the Department of Public Works and 
Highways;


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j) Grantee -  shall refer to a Person to whom a Concession for 
Petroleum 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;
l) 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;
o) Petroleum Products -  shall refer to any liquid petroleum product 
obtained from 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;
u) Pipeline Operators -  Persons operating Petroleum Pipeline or 
Pipeline systems;
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v) PNP -  shall refer to the Philippine National Police; and
w) Transportation 
of Petroleum 
Products -  shall 
refer to the 
conveyance, 
carriage or transmission of Petroleum 
Products 
through a Petroleum Pipeline(s).
CHAPTER I I
JURISDICTION OF THE DEPARTMENT OF ENERGY
Sec. 5. Jurisdiction. This Act strengthens and confirms the sole regulatory 
and administrative power and authority of the DOE to supervise and regulate 
Petroleum Pipeline Operations. In addition 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.


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CHAPTER I I I  
PIPELINE CONCESSION
Sec. 6. Nature o f 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.
Sec. 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 Philippines at least sixty percent (60%) of whose 
capital is owned by such citizens.
Sec. 8. Term o f 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 be given for the automatic renewal of the Grantee's 
Concession in view of the Grantee's sizeable investments, infrastructure and 
installations or the necessity and/or urgency of maintaining the Pipeline to serve 
public interest. For existing Pipeline Operators, the term of their Concession shall 
be as provided in their existing Concession Agreements: Provided that, existing 
Pipeline operators may apply for a Contract of Concession under this Act prior to 
the expiration of their current Concession.


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CHAPTER IV
PROCEDURES FOR APPLICATION OF CONCESSION
Sec. 9. Application o f 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.
Sec. 10. Requirements. The applicant must demonstrate that it is legally 
existing and qualified to 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.
Sec. 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.
Sec. 12. Disposition o f 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


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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.
Sec. 13. Issuance o f 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.
Sec. 14. Registry o f Pipeline Operators. The DOE shall establish and 
maintain a registry of all pipeline operators or Concession Grantees.
CHAPTER V 
RIGHTS GRANTED
Sec. 15. Grant o f 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 defined in the Pipeline Concession, in accordance with the 
provision of this Act and the implementing rules and regulations.
This right includes the construction, installation and operation of pipelines, 
pipeline facilities, pumping 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:


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(a) The right of the Grantee to own, construct, install, operate
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and maintain a Petroleum Pipeline system passing through
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a designated area(s), specifying the province(s), city(ies),
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and/or municipality(ies);
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(b) The Grantee's right to acquire rights of way, easements and
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other similar rights on, over, under, across and through the
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designated area(s) or adjacent thereto;
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(c) The right of eminent domain to be exercised by the
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Government, as represented by the DOE, for and on behalf
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of and/or through the Grantee, over private property when
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the occupation of private land is needed by the Grantee in
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connection with 
his Concession, for the purpose of
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constructing, 
installing, 
maintaining 
and 
operating
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Petroleum Pipelines, road, wells, tanks, reservoirs, pumping
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stations for public use or benefit;
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(d) Term of Concession;
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(e) Right to receive assistance from the DOE in obtaining fiscal
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and non-fiscal incentives granted by this Act;
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(f) 
Right to receive assistance from the DOE and/or other
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government instrumentalities in securing permits, licenses
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and 
clearances 
relating 
to 
the 
Petroleum 
Pipeline
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Operations; and
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(g) Other rights consistent with this Act.
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CHAPTER V I
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THE NATIONAL PIPELINE BOARD AND THE PETROLEUM PIPELINE
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CODE
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Sec. 16. National Pipeline Board. There is hereby created the National
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Pipeline Board. The NPB shall be composed of the Secretary of the DOE as
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Chairman and the Secretaries of the Department of Environment and Natural


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Resources, Department of Transportation, and the Department of Public Works 
and Highways, as members, and representatives from Pipeline Industry 
operators, who shall automatically be members by reason of being Grantees of a 
Pipeline Concession. The DOE Secretary, in his capacity as Chairperson, shall, 
within thirty (30) days from the effectivity of this Act, convene the NPB to 
discharge its powers and functions as provided in Section 17 hereof. The Board 
shall be assisted by a Technical Secretariat attached to the OIMB of the DOE. 
The number of staff of the Technical Secretariat and the corresponding positions 
shall be determined by the Board, subject to approval by the Department of 
Budget and Management (DBM) and existing civil service rules and regulations.
Sec. 17. Powers and Functions o f the 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 
Petroleum 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 
Petroleum 
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 sufficiently 
holding 
consultations with all its members to ensure transparency 
and further encourage private sector participation. The NPB
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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 duties and functions under this section, it 
shall, whenever appropriate, 
be authorized 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 Petroleum Products or price disruptions and 
where shortages of Pipeline capacity and reliability concerns 
may have or are anticipated to contribute to shortages 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 Petroleum Products, energy 
consumption, pipeline capacity, population and economic 
development.
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CHAPTER V II
RIGHT OF WAY, EXPROPRIATION, EASEMENT
Sec. 18. Grant o f Right o f 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, MM DA, their successors and 
assigns, shall grant the necessary right of way over non-private property within 
their jurisdiction.
Sec. 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 in acquiring right of way over government property.
Sec. 20. Right o f Way over Private Property; Expropriation. The DOE shall 
assist or represent Grantees of Concessions in procuring the necessary right of 
way over private property.
When the occupation or possession of private land is needed by the 
Grantee in connection with its Concession, for the purpose of constructing, 
installing, maintaining and operating pipelines, reservoirs, wells, roads, railroads 
telephone 
and 
telegraph 
lines, 
airfields, 
radio 
stations, 
powerhouses, 
transmission lines, pumping stations, wharves, piers, and terminals, which are 
herby declared to be for public use or benefit, the right of eminent domain may 
be exercised by the Government, as represented by the DOE, for and on behalf 
of the Grantee, in accordance with the applicable laws on the matter. In all cases 
of voluntary agreement between the Grantee and a private landowner, a copy 
thereof shall be furnished the DOE. For the purpose of this Section, the necessity 
of the work in Petroleum Pipeline Operations will be presumed in cases of 
construction of Pipelines, tanks, pumping stations, power systems, and other 
means of transportation and communication, including any auxiliary facilities and 
works.
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Sec. 21. Easement Over Public Land. When easement or right of 
temporary occupancy over public land is needed by a Grantee for the purpose of 
carrying out any work necessary to its Petroleum Pipeline Operations, such right 
may be granted by the Government through the DOE subject to applicable laws 
and regulations. The same presumption in Section 20 applies in this instance.
CHAPTER V III
COMPLIANCE WITH STANDARDS
Sec. 22. Petroleum Pipeline Code. All Grantees of a Pipeline Concession 
under this Act shall provide safeguards for the safety, reliability, adequacy, 
security, stability and integrity of their Petroleum Pipeline systems in accordance 
with the technical specifications and performance standards set forth in the 
Petroleum Pipeline Code to be promulgated by the NPB, as may be amended.
CHAPTER IX 
PIPELINE SECURITY
Sec. 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 DND, DPWH, PNP, MM DA, DILG, LGUs and the 
appropriate government agencies and instrumentalities shall implement a one- 
call system, whereby any 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 foregoing to the 
affected Grantee or other underground utility providers and to provide a 
mechanism for immediate liaison and coordination with all relevant government 
agencies to avoid damage to or loss of property as well as injury to persons.
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The DOE shall implement a procedure for a systematic response to 
emergency cases, including without limitation, incidents involving leaks, breaches 
on the Pipelines or Pipeline facilities and other similar occurrences, whereby 
there will be immediate, appropriate and coordinated response actions from the 
concerned LGUs, Bureau of Fire Protection, the DENR, DOH and such other 
government agencies and instrumentalities. In case of remediation or clean-up, 
the DENR shall be the lead agency (in coordination with other government 
agencies or instrumentalities) in directing the clean-up of affected areas 
premised on a risk-based criteria.
Sec. 24. Inter-agency Cooperation. Should the DOE find it necessary, it 
shall consult, participate, cooperate and enter into agreement with other 
government agencies and instrumentalities, non-governmental organizations or 
people's organizations and private enterprises in the furtherance of the foregoing 
objectives.
CHAPTER X
ROLE OF GOVERNMENT AGENCIES
Sec. 25. Ro/e o f 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 DOTr 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
(ii) 
When requested by the DOE, assist the DOE in 
identifying routes, zones or areas of operations 
of particular operators.
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(b) The DPWH shall, when necessary, provide the technical 
support in the construction and installation of Petroleum 
Pipelines.
(c) The DILG shall:
(i) 
Provide, through the Philippine National Police 
(PNP), manpower and available resources to 
Grantees of Pipeline Concessions in case of 
threats to the security of the Pipelines and other 
similar acts;
(ii) 
Employ 
the 
assistance, 
cooperation 
and 
coordination of LGUs in the implementation of 
the policies and orders issued by the DOE; and
(iii) 
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 X I
ABANDONMENT AND DECOMMISSIONING
Sec. 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
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there are no foreseeable new users or customers 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 the 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.
Sec. 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 
subject to Value Added Tax, income tax and such other taxes, charges and fees.
CHAPTER X II 
FISCAL INCENTIVES
Sec. 28. Taxes. Pipeline operations shall be subject to the payment of all 
taxes, duties, fees or charges and other impositions under the National Internal
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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 Investment Code, as amended.
Sec. 29. Customs Duties. The Grantee may import, 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 X III
FORCE MAJEURE AND/OR FORTUITOUS EVENTS
Sec. 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 obligation on the part of the Grantee in so far as such 
failure results from force majeure and/or fortuitous events, including without 
limitation, acts of God, war, insurrection, riot, civil commotion, strike, tide, storm, 
flood, lightning, explosion, fire, earthquake, passage of laws, orders and rules 
and any other happening which the Grantee could not reasonably prevent, 
control or avoid.
CHAPTER XIV 
PROHIBITED ACTS
Sec. 31. Prohibited Acts. Without the prior written consent of the Grantee, 
it shall be unlawful for any Person to:
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(a) Demolish, excavate, tunnel, 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 direct benefit of petroleum 
delivery service obtained through any of the acts mentioned 
in paragraphs (a), (b), (c) and (d) above.
Sec. 32. Fines end 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 (PhP10,000.00) but 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 a juridical 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 
APPROPRIATIONS
Sec. 33. Appropriations. Such sums as may be necessary for the initial 
implementation of this Act shall be taken by the DOE from its annual 
appropriation. Thereafter, the fund necessary to carry out the provisions of this 
Act shall be included in the annual General Appropriations Act.
CHAPTER XVI 
FINAL PROVISIONS
Sec. 34. Implementing Rules and Regulations The DOE, in coordination 
with the NPB, shall promulgate the necessary implementing rules and regulations 
within thirty (30) days after the effectivity of this Act. There shall be a mandatory 
review every two (2) years of the implementing rules and regulations and the 
pipeline standards set pursuant to the provisions of this Act.
Sec. 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.
Sec. 36. Non-Retroactivity Clause. Concessions which have been granted 
under previous laws at the time this Act becomes effective, shall remain effective 
and shall continue to operate under their existing Concessions or authority.
Sec. 37. Grantees o f Concession 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 thereof, but may not be renewed except pursuant to the 
provisions of this Act.
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Sec. 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 of the 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 petroleum 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
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non-price regulatory functions of the Energy Regulatory Board were transferred 
to the Energy Regulatory Commission.
Sec. 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.
Sec. 40. Transitory Provision. Pipeline Operators or Grantees of Petroleum 
Pipeline Concessions which have been constructed and have commenced 
operation prior to the date of 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 functions of the Director of Mines and 
the Secretary of Agriculture and Natural 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 administrative or 
regulatory permit or concession, which concession certificate or franchise shall 
be allowed to its full term but may not be renewed except pursuant to the 
provisions of this Act.
Sec. 41. Effectivity. This Act shall take effect fifteen (15) days upon its 
publication in the Official Gazette or in at least two (2) newspapers of general 
circulation.
Approved,
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