Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL No. _ 4589

Introduced by Representative Michael L. Romero

EXPLANATORY NOTE

A national fuel reserve will enable the government to protect Filipino
consumers from the shocks of price hikes of crude oil in the world market and
resulting rate increases of public utilities and fuel at the gasoline stations, as
well as supply disruptions results from natural disasters and calamities.

In this bill, the core of the Strategic Fuel Reserves System of the Philippines shall
be made up of all government-owned, operated, or controlled stockpiles and
facilities, including all fuel stations of all Departments in the Executive Branch,
the Armed Forces of the Philippines, the Philippine National Police, other armed

and uniformed services, the Philippine Ports Authority, other port authorities,
and free ports.

The total government component of the stockpile shall consist of at least fifteen
(15) days stockpile of each of these basic fuel products: liquefied petroleum gas,
natural gas, diesel, gasoline, kerosene, aviation fuel, and bunker fuel.

The private sector component of the core shall consist of at least fifteen (15) days
stockpile of each of these basic fuel products: liquefied petroleum gas, natural
gas, diesel, gasoline, kerosene, aviation fuel, and bunker fuel. The private sector

component shall also have at least fifteen (15) days stockpile of unprocessed
petroleum.


Augmentation reserves shall consist of stockpiles of petroleum and
petroleum products imported through government-to-government bilateral and
multilateral agreements from petroleum producing countries. These additional
stockpiles shall be stored in both government and private sector storage facilities.

The System shall prioritize the distribution and allocation its stockpile of reserves
to assure continuity of essential services, including, but not limited to the
following:

a. Hospitals and social service care facilities for seniors, youth, persons
with disabilities, and women in distress;

Water distribution;

Sewerage treatment and water filtration;

Power generation;

Airports and seaports;

Schools and other education facilities; and

Newspapers, radio stations, television stations, and other strategic
communications facilities

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The Board shall determine the purposes and priorities of stockpile fuel
distribution directly to Filipino consumers and households by considering factors
such as population size, population density, and strategic location in provinces
and regions. The Board shall formulate, approve, and impiement a Master Plan
on Energy Security.

The Master Plan on Energy Security and core components of the System
shall be operational within one year from the effectivity of this Act. The whole

System shall be fully operational within three (3) years from the effectivity of this
Act.

BACKGROUND

The Energy Regulatory Commission has current policies on the
maintenance of fuel reserves by private oil companies operating in the
Philippines.

The Malampaya Fund, established by virtue of Presidential Decree 910 on
March 22, 1976, was created “to finance energy resource development and
exploitation programs and projects of the government and for such other


purposes...directed by the President” and has been utilized to cushion the impact
fuel price hikes on the Filipino people.

This House Bill seeks 6 establish a national strategic fuel reserve, that has
been an option of thé Department of Energy to address energy crisis.

Hh

P

MICHAEL L. ROMERO



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session.

HOUSE BILL No. 4689

Introduced by Representative Michael L. Romero

AN ACT
ESTABLISHING THE STRATEGIC FUEL RESERVE SYSTEM OF
THE PHILIPPINES, TO STABILIZE SPIKES IN FUEL PRICES,
DEFINING ITS PURPOSES, PRIORITIES, FEATURES,
APPROPRIATING FUNDS THEREFOR, AND FOR OTHER
PURPOSES

Be it enacted by the Senate and the House of Representatives of the Philippines in
Congress assembled:

SECTION 1. SHORT TITLE. - This Act shall be known as “THE

PHILIPPINE STRATEGIC FUEL RESERVE and FUEL PRICE STABILIZATION
ACT of 2019”.

SECTION 2. ESTABLISHMENT OF THE STRATEGIC FUEL
RESERVES SYSTEM. - The Strategic Fuel Reserves System of the Philippines,

hereinafter referred to as the System or Fuel Reserves, is hereby established.

The core of the System shall be made up of all government-owned, operated, or

controlled stockpiles and facilities, including all fuel stations of all Departments


in the Executive Branch, the Armed Forces of the Philippines, the Philippine
National Police, other armed and uniformed services, the Philippine Ports
Authority, other port authorities, and Freeport’s. The total government
component of the stockpile shall consist of at least fifteen (15) days stockpile of
each of these basic fuel products: liquefied petroleum gas, natural gas, diesel,
gasoline, kerosene, aviation fuel, and bunker fuel.

The private sector component of the core shall consist of at least fifteen (15) days
stockpile of each of these basic fuel products: liquefied petroleum gas, natural
gas, diesel, gasoline, kerosene, aviation fuel, and bunker fuel. The private sector

component shall also have at least fifteen (15) days stockpile of unprocessed
petroleum.

Augmentation reserves shall consist of stockpiles of petroleum and petroleum
products imported through government-to-government bilateral and multilateral
agreements from petroleum producing countries. These additional stockpiles

shall be stored in both government and private sector storage facilities.

SECTION 3. PURPOSES AND PRIORITIES. - The System shall
protect Filipino households, consumers, marginalized sectors, and islands from
acute, chronic, and major disruptions in the delivery of basic services and from

impact of high inflation resulting from oil supply disruptions and wild price
fluctuations.

SECTION 4. MANAGEMENT OF THE SYSTEM. - The System shall
have a Board of Trustees as its multi-sectoral and collegial governing body with
corporate and quasi-judicial powers. For administrative and budgeting purposes,
it shall be an attached agency of the Department of Energy. The Board of
Trustees shall consist of the following:


Chairman : Secretary of Energy

First Vice Chairman ‘ecretary of Social Welfare and Development
Second Vice Chairman : Secretary of the Interior and Local Government
Corporate Secretary : Executive Director of the Energy Regulatory

Commission Members:

Executive Director of the Office of Civil Defense;
Representative, Department of Trade and Industry;
Representative, Department of Transportation;
Representative, Department of Finance;

Representative, Bureau of Customs;

Representative, Armed Forces of the Philippines;
Representative, Philippine National Police;

Representative, Philippine Ports Authority;

Representative, Civil Aviation Authority of the Philippines;
Representative, Department of Health;

Representative, Department of Agriculture;

Representative, Philippine Chamber of Commerce and Industry;
Representative, Presidential Management Staff; and
Representative, Philippine International Trading Corporation.

The Board shall meet regularly once a month and may convene special and
emergency meetings as frequently as may be deemed necessary by the Secretary
of Energy or whenever ordered to convene by the President of the Philippines.

SECTION 5. PURPOSES AND PRIORITIES OF THE SYSTEM. - The
System shall prioritize the distribution and allocation its stockpile of reserves to

assure continuity of essential services, including, but not limited to the following:

(a) Hospitals and social service care facilities for seniors, youth, persons
with disabilities, and women in distress;

(b) Water distribution;

(©) Sewerage treatment and water filtration;
(d) Power generation;

(© Airports and seaports;

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(8) Schools and other education facilities;
(g) Newspapers, radio stations, television stations, and other strategic
communications facilities
The Board shall determine the purposes and priorities of stockpile fuel
distribution directly to Filipino consumers and households by considering
factors such as population size, population density, and strategic location in
provinces and regions. The Board shall formulate, approve, and implement a

Master Plan on Energy Security.

SECTION 6. PHASED IMPLEMENTATION. - The Master Plan on
Energy Security and core components of the System shall be operational within
one year from the effectivity of this Act. The whole System shall be fully
operational within three (3) years from the effectivity of this Act.

SECTION 7. IMPLEMENTING GUIDELINES. - The Board shall
approve and issue the implementing rules and regulations of this Act not later

than ninety (90) days from the effectivity of this Act.

SECTION 8. APPROPRIATIONS. - Initial funding for this Act shall
be sourced from the Malampaya Fund. The Board, in consultation with the
Department of Budget and Management and the Department of Finance, shall
determine the amounts of initial Malampaya Fund sourcing and continuing
funding through the annual general appropriations and the Malampaya Fund.

SECTION 9. SEPARABILITY. - If any provision or part of this Act is
declared invalid or unconstitutional, the remaining parts or provisions not

affected shall continue to be in full force and effect.


SECTION 10. REPEALING CLAUSE. - All laws, executive orders, and
administrative orders or parts thereof inconsistent with any provision of this Act

are hereby repealed or amended accordingly.
SECTION 11. EFFECTIVITY CLAUSE. - This Act shall take effect
fifteen (15) days after its publication in the online version of the Official Gazette

or in two (2) newspapers of general circulation or with established internet

website presence.

Approved.

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