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    5) Republic V Palawan

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    Mav Esteban
    1) The case involved a dispute over whether the Province of Palawan was entitled to 40% of proceeds from the drilling of the Camago-Malampaya natural gas reservoir located approximately 80km from Palawan's coastline. 2) The Court ruled that Palawan's territorial jurisdiction referred only to its land area and did not extend to the natural gas reservoir located miles from its coast in the continental shelf, as no law granted Palawan jurisdiction over that area. 3) Therefore, Palawan was not entitled to 40% of proceeds from the drilling of the Camago-Malampaya reservoir since it was located outside of Palawan's territorial boundaries.

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    5) Republic V Palawan

    Uploaded by

    Mav Esteban
    69 views4 pages
    1) The case involved a dispute over whether the Province of Palawan was entitled to 40% of proceeds from the drilling of the Camago-Malampaya natural gas reservoir located approximately 80km from Palawan's coastline. 2) The Court ruled that Palawan's territorial jurisdiction referred only to its land area and did not extend to the natural gas reservoir located miles from its coast in the continental shelf, as no law granted Palawan jurisdiction over that area. 3) Therefore, Palawan was not entitled to 40% of proceeds from the drilling of the Camago-Malampaya reservoir since it was located outside of Palawan's territorial boundaries.

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    5) Republic v Palawan

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    1) The case involved a dispute over whether the Province of Palawan was entitled to 40% of proceeds from the drilling of the Camago-Malampaya natural gas reservoir located approximately 80km from Palawan's coastline. 2) The Court ruled that Palawan's territorial jurisdiction referred only to its land area and did not extend to the natural gas reservoir located miles from its coast in the continental shelf, as no law granted Palawan jurisdiction over that area. 3) Therefore, Palawan was not entitled to 40% of proceeds from the drilling of the Camago-Malampaya reservoir since it was located outside of Palawan's territorial boundaries.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    69 views4 pages

    5) Republic V Palawan

    Uploaded by

    Mav Esteban
    1) The case involved a dispute over whether the Province of Palawan was entitled to 40% of proceeds from the drilling of the Camago-Malampaya natural gas reservoir located approximately 80km from Palawan's coastline. 2) The Court ruled that Palawan's territorial jurisdiction referred only to its land area and did not extend to the natural gas reservoir located miles from its coast in the continental shelf, as no law granted Palawan jurisdiction over that area. 3) Therefore, Palawan was not entitled to 40% of proceeds from the drilling of the Camago-Malampaya reservoir since it was located outside of Palawan's territorial boundaries.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 4

    Republic of the Philippines v Provincial Government of Palawan

    GR No. 170867, 4 Dec. 2018


    Tijam, J.:

    FACTS
    Service Contract No. 38 was entered by DOE and Shell Phil. Exploration (SPEX) which
    1

    led to the drilling of the Camago-Malampaya 2 natural gas reservoir. In Feb. 1998, AO
    3813 was issued by Pres. FVR. However, in June 1998, DOE wrote to Palawan Gov.
    Socrates, requesting for the deferment of the payment of 50% of the Palawan’s share in
    the project for the first 7 years of operation which it would use to pay the NPC’s take-
    or-pay quantity (TOPQ) obligation.

    According to respondent, since the reservoir is located within its territorial jurisdiction,
    it is entitled to 40% share under Sec. 290 of the LGC. On the other hand, the petitioner
    counters that since the gas fields were approximately 80km from Palawan’s coastline,
    they are outside the territorial jurisdiction of the province and is within the national
    territory of the Philippines.

    In 2003, the respondent filed a petition before the RTC Palawan seeking judicial
    determination of its rights under AO 381, RA 7611, the LGC. It asked the RTC to
    declare that the Camago-Malampaya natural gas reservoir is part of its territorial
    jurisdiction and that it is entitled to receive 40% from the petitioner’s share in the
    proceeds of the project as provided for under Sec. 290 of the LGC. On contrary,
    petitioner maintained that Palawan was not entitled to the 40% share for the reservoir is
    outside its territorial jurisdiction. According to petitioner, Palawan’s territorial
    jurisdiction is limited to its land area and to the municipal waters within 15km from its
    coastline.

    1
    Provides for the production sharing scheme whereby the Gov was entitled to receive an amount
    equal to 60% while SPEX to 40% of the net proceeds.
    2
    The nearest point of the Camago-Malampaya production area is at a distance of 93km to
    Kalayaan Island group and 48.8km to the Province of Palawan.
    3
    Provides that the Province of Palawan is to receive about $2.1B from the estimated $8.1B total
    government shared from the natural gas project for the 20-year contract period.
    The RTC eventually took side with Palawan. 4 It ruled that it was unthinkable to limit
    Palawan’s territorial jurisdiction to its landmass and municipal waters considering that
    the LGC empowered them to protect the environment. RA 7611 also adopted a
    comprehensive framework for the sustainable development of Palawan compatible
    with protecting and enhancing the natural resources and endangered environment of
    the province. Moreover, the State’s resources must be shared with the LGUs if they
    were expected to deliver basic services to their constituents and to discharge their
    functions as agents of the State in enforcing laws, preserving the integrity of the
    national territory and protecting the environment. The RTC then issued an Order
    directing, among others, the petitioners to submit full accounting and full report of the
    actual payments made.

    A petition for review was filed by the petitioner before the Court. Hence, this case.

    ISSUE
    Whether the Camago-Malampaya reservoir is within the territorial jurisdiction of
    Palawan making the same entitled to 40% share in the proceeds of the project.

    HELD
    No, Palawan is not entitled to 40% share in the proceeds of the drilling of the Camago-
    Malampaya gas reservoir for it is outside its territorial jurisdiction.

    The LGC does not define the term “territorial jurisdiction.” However, the provisions of
    LGC indicate that the term refers to the LGU’s territorial boundaries. Under the LGC, a
    “province” is composed of a cluster of municipalities, or municipalities and component
    cities.

    In the creation of municipalities, cities and barangays, the LGC uniformly requires that
    the territorial jurisdiction of these government units be “properly identified by metes
    and bounds.”5 Therefore, the intention is to consider an LGU’s territorial jurisdiction as
    4
    RTC ruled that the Palawan is entitled to the 40% share of the national wealth pursuant to the
    provisions of Sec. 7, Art. X of the 1987 Constitution and this right is in accord with the provisions of the
    Enabling Act, RA 7160 (Local Gov. Code). It rejected the reliance on the cases of Tan v COMELEC, as it
    was an election controversy involving the creation of a new province, LLDA v CA, as it highlighted the
    primacy of the said agency’s Chater over the LGC, and Municipality of Paoay v Manaois, as it was
    rendered before the principle of local autonomy was instituted in the 1987 Constitution and the LGC. It
    also ruled the Regalian Doctrine to be inapplicable for said doctrine is subject to the constitutional
    provision giving LGUs an equitable share in the proceeds of the utilization and development of national
    wealth within their respective doctrines and is also subject to the 40% LGU share set by the LGC. Hence,
    from the National Government’s previous actions (wherein Palawan received its shares from collections
    derived from the West Linapacan Oil Fields) and previous issuance (pertaining to Pres. FVR’s AO 381
    acknowledging Palawan’s claim and share in the proceeds of the Camago-Malampaya project), it was too
    late in the day for the National Government to take a 180-degree turn.
    5
    Secs. 386, 442, 450
    pertaining to a physical location or area as identified by its boundaries. LGUs are
    creations of law. In enacting charters of LGUs, Congress is called upon to properly
    identify their territorial jurisdiction by metes and bounds. Clearly, an LGU’s territorial
    jurisdiction cannot extend beyond the boundaries set by its organic law.

    In addition, an LGU’s territorial jurisdiction is not necessarily coextensive with its


    exercise or assertion of powers. To hold otherwise may result in condoning acts that are
    clearly ultra vires. Moreover, the LGU’s statutory obligation to maintain ecological
    balance is but part of the nation’s collective effort to preserve its environment as a
    whole. In fine, territorial jurisdiction is defined, not by the local government, but by the
    law that creates it; it is delimited, not by the extent of the LGU’s exercise of authority,
    but by physical boundaries as fixed in its charter.

    Under the LGC, territorial jurisdiction is contextually synonymous with territory and
    the term “territory” is used to refer to the land area comprising the LGU. This is clear
    from the fact that: 1) the law requires the territory to be contiguous, 6 except when
    comprised of two or more islands; 2) the minimum area of contiguous territory is
    measured in km2; 3) such minimum area must be certified by the Lands Management
    Bureau; and 4) the territory should be identified by metes and bounds, 7 with technical
    descriptions.8

    In the case of Tan vs COMELEC, it was ruled by the Court that territory refers only to
    the mass of land area and excludes the waters over which the political unit exercises
    control. In the context of the LGC, there would arise no need for the legislators to use
    the word contiguous if they had intended that the term “territory” embrace not only
    land area but also territorial waters. LGU may have control over the waters but it may
    not necessarily claim them as part of their territory. Hence, the exercise of authority
    does not determine the LGU’s territorial jurisdiction. The Court also, in this case,
    excluded the marginal sea from the LGU’s territory.

    In the instant case, the Camago-Malampaya reservoir is located in the continental shelf.
    If the marginal sea is not included in the LGU’s territory, with more reason should the
    continental shelf, located miles further, be deemed excluded therefrom.

    In fine, an LGU’s territorial jurisdiction refers to its territorial boundaries or to its


    territory. The territory of LGUs refers to their land area, unless expanded by law to
    include the maritime area. Since no law grants the Province of Palawa territorial
    6
    “Contiguous” signifies 2 solid masses being in actual contact.
    7
    “Metes and bounds” are boundaries or limits of a tract of land especially as described by
    reference and distances between point on the land.
    8
    “Technical descriptions” are used to describe these boundaries and are commonly found in
    certificates of land title.
    jurisdiction over the Camago-Malampaya reservoir, said area cannot be considered as
    part of the territory of the Province. Accordingly, only the utilization of natural
    resources found within the land area as delimited by law is subject to the LGU’s
    equitable share under the LGC.

    On a separate note, Sec. 1, Art. X of the 1987 Constitution did not apportion the entire
    Philippine territory among the LGUs. By indicating that the LGUs comprise the
    territorial subdivisions of the State, the Constitution did not make every portion of the
    national territory a part of an LGU’s territory. The particular wordings of the said
    provision were used only because the municipalities, and barangays have been fixed as
    the standard territorial and political subdivisions of the Philippines. Said constitutional
    provision was intended merely to institutionalize the LGUs.

    P.S., (baka maitanong) the Federal Paramountcy Doctrine 9 is not applicable in the case
    because, but not limited to, of the following reasons: 1) the US does not appear to have
    an equitable sharing provision to Sec. 7, Art. X of the 1987 Constitution; 2) the
    Philippines is not composed of States that were previously independent nations; 3) the
    Court is not called upon to determine who between the Province of Palawan and the
    National Government has the paramount or dominant right to explore or exploit the
    natural resources in the marginal sea or beyond.

    9
    A doctrine derived from 4 US jurisprudences, provides that Federal Government, rather than
    the State, have the paramount rights over a particular area which includes full dominion over its natural
    resources.

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