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SECTION 43. Third-Party Access Principles.

Adherence to the principles of transparency, non-discrimination, and safe practices is the key to
the beneficial participation of third-party users. in line with this, the following guiding principles
shall be observed:

(a) The TPA shall be transparent, fair, reasonable, and non-discriminatory with regard to the
rates and access to services for the purpose of enhancing efficiency and optimization of
capacity to avoid overcapacity and encourage necessary investments in the PDNGI:

(b) The TPA shall encourage a diverse and sustainable market for natural gas beyond the
power sector.

(c) The TPA shall be anchored on a safe, secure, reliable, and efficient operation for both the
Permit Holder and the third-party users;

(d) The TPA Permit Holders shall conduct an open, transparent, and sufficient consultation
process with both existing and potential third-party users to discuss the available
capacity; and

(e) The TPA Permit Holders shall regularly publish their available capacity, access terms and
conditions, and rates, which shall be available to the public, and allow the review and
inspection of their facilities and records for verification.

SECTION 44. Negotiated TPA.

Negotiated TPA shall refer to a commercial arrangement which allows the Permit Holder and a
third-party End-user or a non-Affiliate to agree and execute negotiated terms and conditions on
the use of the entire or a portion of the PDNGI Facility Capacity, not considered a public utility,
subject to compliance with the following:

(a) Submission by the Permit Holder to the DOE of a notarized copy of the terms and
conditions of the commercial arrangement; and

(b) The Permit Holder shall comply with the provisions of this IRR, specifically the
responsibilities prescribed under Section 52, TPA Code, and the Gas Policy.

SECTION 45. Competitive TPA.

Competitive TPA shall refer to a commercial arrangement which allows the Permit Holder to offer
its entire or a portion of its PDNGI Facility Capacity, not considered a public utility, to interested
non-Affiliates subject to compliance with the following:

(a) Submission by the Permit Holder to the DOE of a notarized copy of the terms of reference
of the Competitive TPA offer,

(b) The selection process shall be open, transparent, and non-discriminatory to interested
non-Affiliates; and
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(c) The Permit Holder shall comply with the provisions of this IRR, specifically the
responsibilities prescribed under Section 52, TPA Code, and the Gas Policy.

SECTION 46. Regulated TPA.

Regulated TPA shall refer to an offer to the public of the entire or a portion of the Capacity of a
Conventional Transportation System, which is a network of fixed facilities for the purpose of
delivering natural gas, subject to compliance with the following:

(a) Submission by the Permit Holder to the DOE of the terms of reference of the Regulated
TPA offer;

(b) The availment process shall be in accordance with the guidelines issued by the Permit
Holder and approved by the DOE; and

(c) The Permit Holder shall comply with the provisions of this IRR, specifically the
responsibilities prescribed under Section 52, TPA Code, and the Gas Policy.

SECTION 47. Congestion Management.

Whenever a TPA Permit Holder is no longer able to use or has not released the capacity without
justifiable reason, the DOE shall have the authority to direct its release.

The procedure and criteria for release shall be governed by the TPA Code.

RULE V
STANDARDS ON PRODUCT QUALITY, FACILITY, AND SAFETY PRACTICE

SECTION 48. Standards on Downstream Natural Gas Facilities.

All PDNGI Facilities shail be required to provide high quality and efficient service, observe
stringent safety systems, pay attention to design details and structural integrity, and employ best
practices in operation and maintenance. Regulations shall be consistent with both applicable
Philippine and internationally accepted natural gas industry standards. The DOE shall ensure
compliance with these requirements.

Applications for DOE Permits and for the continued operation of the PDNGI Facilities shall be
subject to continuous compliance with these standards.

SECTION 49. Standards on Product Quality.

The Permit Holder and Participant shall maintain the quality of natural gas supply to gas buyers
in accordance with the Philippine and internationally accepted standards, and ensure that the
Delivery of Natural Gas complies with the purification requirements to guarantee the elimination
of associated compounds which are unnecessary or damaging to the PDNGI Facilities. The DOE
shall ensure compliance with this requirement.
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SECTION 50. Standards on Safety Practice.

The Permit Holder and Participant shall implement an acceptable health, safety, security, and
environmental management system in accordance with applicable Philippine and internationally
accepted standards. The DOE, DENR, DOH, DOLE, and other concerned agencies shall ensure
compliance with this requirement.

SECTION 51. Safety Standards.

The DOE, in collaboration with the NREB and PNOC, shall develop and implement safety
standards of Natural Gas, including Renewable Gases, in order to address their unique
properties and risks.

RULE VI
RESPONSIBILITIES OF PERMIT HOLDERS AND PARTICIPANTS

SECTION 52. Responsibilities of Permit Holders.
A Permit Holder shall have the following responsibilities:

(a) Align all goals, objectives, and accomplishments with the declared policies of the Act and
the PEP;

(b) Take direct responsibility and accountability for the construction, operation, and
maintenance of PDNGI Facilities by providing the necessary services, technology, and
financing, either by itself or through its duly authorized contractors;

(c) Secure a Permit before engaging in any activity relating to siting, construction, operation
and maintenance, expansion, modification, rehabilitation, decommissioning, and
abandonment of PDNGI Facilities;

(d) Comply with regulatory obligations, maintain complete records, and submit all reportorial
requirements and other documents as may be required by the DOE and other
government agencies pursuant to the Act and this IRR;

(e) Comply with the standards on Natural Gas quality, facility, construction and equipment
installation, safety, and security of operations and environmental protection in the siting,
construction, operation and maintenance, expansion, modification, rehabilitation,
decommissioning, and abandonment of PDNGI Facilities;

(f) Operate the PDNGI Facility in strict adherence with the scope and limits of the Permit,
and in accordance with the HSSE best practices and the Philippine and internationally
accepted standards;

(g) Allow examiners of the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC)
entry to the facility premises and full access to accounts, books, and records for tax and
other fiscal purposes, in accordance with BIR and BOC rules and procedures:
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(h) Allow the DOE, IA-HSSE IMT, ERC, PCC, and other government agencies, entry to the

(i)

()

facility premises and full access to operational records for inspection and monitoring
activities, in accordance with the rules and procedures of such government agencies:

Give preference to qualified local talent for hiring, and to local companies or agencies in
entering into contracts on projects or services which are required in the construction or
operation of the PONG! Facility;

Hold the DOE, ERC, IA-HSSE IMT, and other government agencies, their officers,
agents, and employees, free and harmless from and against all suits, claims, demands,
or actions of any nature or kind, arising out of their acts or omissions in the performance
of any activity in connection with the implementation of the Act: Provided, That such acts
or omissions are lawful and not contrary to the provisions of the Act and this IRR;

(k) Participate in the development, issuance, and review of plans, protocols, standards, and

()

codes applicable to the PDNGI:

Establish and maintain a decommissioning fund at the start of operations of the PDNG!
facility to be utilized for its decommissioning in accordance and consistent with the
policies and guidelines of the DENR on the establishment, maintenance, and use of the
environmental guarantee fund to ensure compliance with, among others,
decommissioning obligations in all co-located or single projects that have been
determined by the Environment Management Bureau to pose a significant public risk:

(m)Unbundle and make available to the public its unbundled rates and fees, if applicable;

(n) Not engage in Anti-Competitive Behavior,

(0) Secure an insurance policy, a certified true copy of which shall be submitted to the DOE

within sixty (60) days from the date of issuance of the PTC, PTE, PTR, PTM or POM to
adequately cover/answer for any potential damage to the environment, lives, and/or
property, in accordance with existing laws, rules and regulations based on the
environmental (land, air, water, and people) impact identification, prevention and
mitigation assessment and the seismic, geologic, oceanographic, atmospheric and
security hazard to infrastructure and process identification, prevention and mitigation
assessment; and

(p) Such other responsibilities mandated by the DOE to ensure the development of the

PDNGI.

SECTION 53. Responsibilities of Participants.

(a) Align all goals, objectives, and accomplishments with the declared policies of the Act and

the PEP;
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(b) Secure an Accreditation before engaging in any activity relating to the trade of Natural
Gas;

(c) Comply with regulatory obligations, maintain complete records, and submit all reportorial
requirements and other documents as may be required by the DOE and other
government agencies pursuant to the Act and this IRR;

(d) Comply with the standards on natural gas quality in the trade of Natural Gas;

(e) Allow examiners of the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC)
entry to the facility premises and full access to accounts, books, and records for tax and
other fiscal purposes, in accordance with BIR and BOC rules and procedures;

(f) Allow the DOE, IA-HSSE IMT, ERC, PCC, and other government agencies, entry to the
facility premises and full access to operational records for inspection and monitoring
activities, in accordance with the rules and procedures of such government agencies;

(g) Give preference to qualified local talents for hiring and to local companies or agencies in
entering into contracts on projects or services which are required in the business;

(h) Hold the DOE, ERC, IA-HSSE IMT, and other government agencies, their officers,
agents, and employees, free and harmless from and against all suits, claims, demands,
or actions of any nature or kind, arising out of their acts or omissions in the performance
of any activity in connection with the implementation of the Act: Provided, That such acts
or omissions are lawful and not contrary to the provisions of the Act and this IRR;

(i) Participate in the development, issuance, and review of plans, protocols, standards, and
codes applicable to the PDNGI;

(j) Unbundle and make available to the public its unbundled rates and fees, if applicable;
(k) Not engage in Anti-Competitive Behavior; and

(l) Such other responsibilities mandated by the DOE to ensure the development of the
PDNGI.

RULE Vil
INCENTIVES

SECTION 54. Fiscal Incentives.

In recognition of the substantial investments needed for the development, construction, lease,
operation and/or maintenance of, and conversion to natural gas facilities, all PDNGI Facilities,
as certified by the DOE, shall undergo an evaluation process for possible inclusion in and
entitlement to incentives under the Strategic Investment Priority Plan (SIPP), subject to the
incentives provided under Title Xill (Tax Incentives) of the National Internal Revenue Code of
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1997 (NIRC), as amended by RA 11534, otherwise known as the “Corporate Recovery and Tax
Incentives for Enterprises Act”, and any amendments thereto.

The purchase and sale of Indigenous Natural Gas, Aggregated Gas, and power generated by
generation facilities using Indigenous Natural Gas and Aggregated Gas shall be exempt from
Value-Added Tax (VAT): Provided, That the exemption from VAT for Aggregated Gas is only to
the extent of the amount of Indigenous Natural Gas attributed to be in the Aggregated Gas. This
includes the (a) purchase and sale of Indigenous Natural Gas and Aggregated Gas by an
aggregator, reseller, supplier, person authorized by the ERC to operate facilities used in the
generation of electricity, or an End-user, and (b) purchase and sale of electricity or ancillary
services produced by a generation facility using Indigenous Natural Gas and/or Aggregated Gas
by a person authorized to (i) operate facilities used in the generation of electricity or ancillary
services, (ii) sell, broker, market, or aggregate electricity to End-users, (iii) consolidate electric
power demand of End-users for the purpose of purchasing and reselling electricity on a group
basis, (iv) engage in the distribution of electricity, or (v) procure or provide ancillary services.
These shall include all modes of purchase and sale, whether through a supply agreement; a
duly-authorized market such as, but not limited to, the Wholesale Electricity Spot Market or the
ancillary reserves market, financial gas contracts, NGSPA; or through other modes.

RULE VIII
PROMOTION OF COMPETITION

SECTION 55. Anti-Competitive Behavior.

In accordance with RA 10667, no Permit Holder or Participant, or any Affiliate thereof, may
engage in any Anti-Competitive Behavior or abuse of its dominant position.

SECTION 56. Fair Access to Capital and Off-Taker Market.

The DOE shall issue applicable policies that promote the financial viability of the PDNGI and
ensure competitive access to both capital and off-taker markets for Natural Gas.

RULE IX
FINES AND PENALTIES

SECTION 57. Administrative Fines and Penalties.

The DOE shall impose the following administrative fines and penalties, without prejudice to other
appropriate administrative fines and penalties that other relevant government agencies may
impose on the Permit Holder or Participant:

(a) Any Permit Holder or Participant found to have violated established Industry Standards
shall be penalized with a fine of Five Hundred Thousand Pesos (P500,000.00) for each
violation. The determination of a violation shall be based on findings made by the DOE;

(b) Any Permit Holder or Participant who fails to comply with lawful orders, directives, or
instructions issued by the DOE shall be penalized with a fine of One Million Pesos
(P1,000,000.00) for each instance of non-compliance; and
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(c) Any Permit Holder or Participant who fails to submit the reportorial requirements
stipulated in the Guidelines for Submission of Reportorial Requirements, attached as
Annex C herein, within the prescribed period shall be penalized with a fine of Two
Hundred Thousand Pesos (P200,000.00) for each instance of non-compliance; and

(d) Any Permit Holder or Participant who fails to fulfill the duties and responsibilities
enumerated in Sections 52 and 53 of this IRR shall be penalized with a fine of One
Hundred Thousand Pesos (100,000.00) for each instance of non-compliance.

The DOE shall review the schedule of fines provided in this Section every five (5) years.
The applicable administrative penalty for Section 39 shall be pursuant to RA 10667.
SECTION. 58. Criminal Fines and Penalties.

Appropriate fines and penalties under existing penal laws shall apply to any criminal violation
committed in the implementation of the Act.

RULE X
TRANSITORY PROVISIONS

SECTION 59. Existing Systems.

PDNGI Facilities that have been constructed prior to the effectivity of the Act shall continue to be
operated under their existing Permits and shall comply with additional requirements as
applicable.

The application and implementation of the pertinent provisions of the Act shall not impair vested
rights or obligations of contracts. Current and subsisting agreements shall remain valid and in
force in accordance with the existing terms and conditions agreed to by the parties until the
expiration or termination thereof.

All Permit Holders and Participants shall comply with the provisions of the Act within two (2) years
from the effectivity of this IRR: Provided, That health, safety, security, environmental,
construction, operation, and other permits, licenses, certificates, and authorizations issued prior
to the effectivity of the Act that are not inconsistent herewith shall remain valid.

PDNG Transmission Systems and PDNG Distribution Systems existing at the time of the
effectivity of the Act shall be allowed to continue pursuant to the terms and conditions indicated
in their franchise and until the lapse of the period accorded therein.

SECTION 60. Pending Application.

All applications for any activity in the PDNGI which are pending before the DOE upon the
effectivity of this IRR shall be covered by the Act.

Furthermore, all applications, plans and processes requiring DOE review or approval in
connection with the Gas Policy shall be held in abeyance until issuance of the said policy.
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In this regard, the DOE shall issue the Gas Policy within six (6) months from the date of effectivity
of this IRR.

RULE XI!
FINAL PROVISIONS

SECTION 61. Amicable Settlement.

All parties shall make their best efforts to amicably settle any dispute arising from the
performance or interpretation of any provision of the Act and this IRR.

SECTION 62. Congressional Oversight.

Pursuant to Section 47 of the Act and upon effectivity of the Act, the Joint Congressional Energy
Commission (JCEC) shall exercise oversight powers over the implementation of the Act. It shall
conduct a policy review five (5) years from the effectivity of the Act, without prejudice to an earlier
periodic review as necessary.

SECTION 63. Reportorial Requirement.

The DOE, ERC, and other relevant government agencies shall submit annual reports which shall
include the latest relevant data, implementation reviews and reports, and policy and regulatory
issues, to the JCEC not later than the fifteenth (15th) day of September of each year.

SECTION 64. Appropriations.

The amount necessary for the implementation of the Act and this IRR shall be included in the
annual General Appropriations Act.

SECTION 65. Separability Clause.

lf, for any reason, any provision of this IRR is declared unconstitutional or invalid, the other parts
or provisions hereof, which are not affected thereby, shall continue to be in full force and effect.

SECTION 66. Repealing Clause.

Department Circular No. 2024-01-0007 or the “Amended Philippine Downstream Natural Gas
Regulation” and any law, presidential decree or issuance, executive order, letter of instruction,
rule, or regulation inconsistent with the provisions of the Act and this IRR is hereby repealed or
modified accordingly.

SECTION 67. Saving Clause.

The provision of Presidential Decree No. 87, otherwise known as “The Oil Exploration and
Development Act of 1972”, RA 9136, otherwise known as the “Electric Power Industry Reform
Act of 2001”, and RA 9513, otherwise known as the “Renewable Energy Act of 2008” shall remain
applicable and shall not in any way be amended or repealed by the provisions of the Act and this
IRR.
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SECTION 68. Effectivity.

This IRR shall take effect fifteen (15) days after its publication in the Official Gazette or in a in at
least two (2) newspapers of general circulation and the filing of a copy with the University of the
Philippines Law Center - Office of the National Administrative Register.

Issued this MAR 26 2025 at DOE, Energy Center, Rizal Drive cor. 34th Street,
Bonifacio Global City, Taguig City, Metro Manila. pr”
4

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narnagt P.M. LOTILLA

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ANNEX A

GUIDELINES FOR ISSUANCE OF PERMITS

Section 1. Coverage.

These guidelines shall govern the issuance of Permit under the Philippine Natural
Gas Industry Development Act.

Section 2. Downstream Natural Gas - Review and Evaluation Committee
(DNG-REC).

The DNG-REC is hereby constituted:

Chair Supervising Undersecretary, Oil industry Management Bureau
(OIMB) or as otherwise designated by the DOE Secretary

Vice Chair : Supervising Assistant Secretary, OIMB or as_ otherwise
designated by the DOE Secretary

Members : Director, OIMB

Director, Legal Services (LS)

Director, Financial Services (FS)

Section 3. Responsibilities of the DNG-REC.

a.

Receives, evaluates, approves, and if applicable, recommends to the
DOE Secretary for approval policies, programs, Permits, implementing
guidelines, and other issuances for the development of the PDNGI;

Recommends to the DOE Secretary for approval the guidelines
implementing standards on product, facility, and safe practices on siting,
construction, operation and maintenance, modification, expansion,
rehabilitation, decommissioning and abandonment of PDNGI Facilities:

Supervises and monitors the progress of siting, construction, operation
and maintenance, modification, expansion, rehabilitation,
decommissioning and abandonment of PDNGI Facilities based on the
approved work program;

Addresses any clarification that may be raised by the DOE Secretary in
connection with recommendations for approval policies, programs,
standards, Permits, implementing guidelines, and other issuances; and

Implement all other necessary measures allowed under existing laws,
rules and regulations.

Page 1 of 24
Guidelines for Issuance of Permits
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Section 4. DNG-REC Secretariat.

The Secretariat shall provide administrative support to DNG-REC in the discharge
of its responsibilities and shall be composed of the following:

Head : Assistant Director, OIMB
Member : Natural Gas Management Division (NGMD), OIMB
Section 5. Downstream Natural Gas - Technical Working Group (DNG-TWG).
The DNG-TWG shall evaluate and recommend to the DNG-REC the result of legal,
technical, and financial evaluations of a Permit application and shall be composed
of the following:
Members : NGMD, OIMB
Downstream Conventional Energy Legal Services Division, LS
Conventional Energy Resources Compliance Division, FS
Section 6. Application Procedure.
a. Pre-application Conference.

i. The Applicant shall submit a request letter for a pre-application
conference with the DNG-REC addressed to the DNG-REC Chair.

ii. The DNG-REC Secretariat shall send a reply letter to the Applicant
stating the schedule of the pre-application conference.

ili. During the pre-application conference, the Applicant shall present its
project proposal to the DNG-REC. The Applicant may likewise discuss
any clarification on the rules and requirements of the Permit
application.

iv. Following the pre-application conference, the Applicant may proceed
to file its Notice to Proceed (NTP) application.

b. Notice to Proceed.

i. The Applicant shall submit the application, with all the prescribed
documentary requirements, addressed to the DNG-REC Chair.

ii. DNG-TWG shall proceed to check the completeness of submitted
documentary requirements within three (3) working days. If complete,
NGMD shall issue the order of payment, and the Applicant shall
proceed to the payment of the processing fee. If incomplete, the
submission shall be automatically rejected without prejudice to the
right of the Applicant to re-apply.

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Guidelines for Issuance of Permits
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For the complete application, the DNG-TWG shall, within twelve (12)
working days, conduct legal, technical, and financial evaluation and
recommend to the DNG-REC the approval or disapproval of the NTP
application.

The DNG-REC shall, within five (5) working days from the date of
receipt of the recommendation from the DNG-TWG, approve or
disapprove the NTP application.

The NTP shall be valid for one (1) year from the date of issuance.

The Permit Holder shail be provided with an advance copy of the
Permit through email with a request to provide feedback via physical
submission or online. The Permit Holder may subsequently claim the
original copy from OIMB or OIMB delivers the same via registered
mail.

. Permit to Construct (PTC).

Thirty (30) working days prior to the NTP expiration, the Permit Holder
shall submit the application for PTC, with all the prescribed
documentary requirements, addressed to the DNG-REC Chair.

DNG-TWG shall proceed to check the completeness of submitted
documentary requirements within three (3) working days. If complete,
NGMD shall issue the order of payment, and the Permit Holder shall
proceed with the payment of the processing fee. If incomplete, the
submission shall be automatically rejected without prejudice to the
right of the Permit Holder to re-apply.

DNG-TWG and DNG-REC shall, within twelve (12) working days,
conduct legal, technical, and financial evaluations and recommend to
the DOE Secretary the approval or disapproval of the PTC application.

The DOE Secretary shall, within five (5) working days from the date of
receipt of the recommendation from the DNG-REC, approve or
disapprove the PTC application.

The validity of the PTC shall be based on the approved project
baseline schedule submitted by the Permit Holder commencing on the
day after the expiration of the NTP.

The Permit Holder shall be provided with an advance copy of the
Permit through email with a request to provide feedback via physical
submission or online. The Permit Holder may subsequently claim the
original copy from OIMB or OIMB delivers the same via registered
mail.

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Guidelines for issuance of Permits
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d. Permit to Operate and Maintain (POM).

vi.

Within thirty (30) working days from the completion of the PDNGI
Facility, the Permit Holder shall submit the application for POM, with
all the prescribed documentary requirements, addressed to the DNG-
REC Chair.

Completion of the PDNGI facility refers to the compliance with the
following:

1. Mechanical completion which means that individual component
and sub-systems of the project have been properly constructed,
installed and functionally tested according to Engineering,
Procurement, and Construction (EPC) Contract requirements in a
safe and prudent manner;

2. Final Testing and Commissioning which means completion of
performance testing to confirm that all components and systems of
the project comply with the design and construction requirements;
and

3. Acceptance of completion by the Permit Holder. This is confirmed
through an acceptance certificate duly signed by the Permit Holder
and the EPC contractor.

DNG-TWG shall proceed to check the completeness of the submitted
documentary requirements within three (3) working days. If complete,
NGMD shail issue the order of payment, and the Permit Holder shall
proceed with the payment of the processing fee. If incomplete, the
submission shall be automatically rejected without prejudice to the
right of the Permit Holder to re-apply.

The DNG-TWG, in coordination with the IA-HSSE IMT, shall conduct
an onsite verification of the completion of the project within ten (10)
working days from the payment of processing fee.

After the onsite verification, the DNG-TWG and DNG-REC shall, within
twelve (12) working days, conduct legal, technical, and financial
evaluations and recommend to the DOE Secretary for further review
and approval of the POM issuance.

The DOE Secretary shail, within five (5) working days from the date of
receipt of the recommendation from the DNG-REC, approve or
disapprove the issuance of the POM.

The POM shall be valid for a maximum period of twenty-five (25) years
commencing on the day after the expiration of the PTC. The POM may
be renewed for such a period as may be determined at the time of
renewal.

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Guidelines for Issuance of Permits
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Vii.

The Permit Holder shall be provided with an advance copy of the
Permit through email with a request to provide feedback via physical
submission or online. The Permit Holder may subsequently claim the
original copy from OIMB or OIMB delivers the same via registered
mail.

e. Permits to Expand (PTE), Rehabilitate (PTR), Modify (PTM), and
Approval of Decommissioning and Abandonment.

The Permit Holder shall submit an application, with all the prescribed
documentary requirements, addressed to the DNG-REC Chair.

DNG-TWG shall proceed to check the completeness of submitted
documentary requirements within three (3) working days. If complete,
NGMD shall issue the order of payment, and the Permit Holder shall
proceed with the payment of the processing fee. If incomplete, the
submission shall be automatically rejected without prejudice to the
right of the Permit Holder to re-apply.

DNG-TWG shall, within twelve (12) working days, conduct legal,
technical, and financial evaluation and recommend to the DNG-REC
the approval or disapproval of the application.

The DNG-REC shall, within five (5) working days from the date of
receipt of the recommendation from the DNG-TWG, approve or
disapprove the application.

The Permit Holder shall be provided with an advance copy of the
Permit through email with a request to provide feedback via physical
submission or online. The Permit Holder may subsequently claim the
original copy from OIMB or OIMB delivers the same via registered
mail.

f. Extension of Permit Validity.

Thirty (30) working days prior to the expiration of the Permit, the Permit
Holder shall submit a request for extension, with all the prescribed
documentary requirements, addressed to the DNG-REC Chair.

Request for an extension shall be allowed by the DNG-REC only on
any of the following grounds:

1. Force Majeure case;

2. Non-issuance of a government permit or clearance without
negligence or fault of the Permit Holder; or

3. Other justifiable reasons, without negligence or fault of the Permit
Holder, which prevented the Permit Holder from complying with its
work commitments.

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Guidelines for Issuance of Permits
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The DNG-TWG shall, within fifteen (15) working days, validate the
ground for extension, the extent of delay, and proposed amended work
program and recommend to the DNG-REC the approval or disapproval
of the request for extension.

The DNG-REC shall, within five (5) working days from the date of
receipt of the recommendation from the DNG-TWG, approve or
disapprove the request for extension.

The Permit Holder shall be given an extended period equivalent to the
approved amended work program.

Section 7. Documentary Requirements.

a. General Information.

An Applicant shall refer to a Philippine or foreign registered natural or
juridical person authorized to engage in the operation of a PDNGI
Facility.

Submission of legal, technical, and financial documents shall be in
English language, and for foreign-registered Applicant must be duly
authenticated by the embassy which has operational coverage of the
Philippines.

Applications for NTP, PTC, POM, PTE, PTR, and PTM must be
submitted in both hard copies, with three (3) complete and legible sets
of legal, technical, and financial documents, and digital copies (in PDF
format on a USB drive). The recommended format includes the use of
the Times New Roman font in size 12, single-line spacing, figures in
A4 size, and maps at an appropriate scale.

A non-refundable processing fee, in accordance with the latest DOE
approved schedule of fees and charges, shall be paid by the Applicant
upon receipt of order of payment from NGMD. Payment may be made
in cash, manager/company check, or by wire/bank transfer payable to
the Philippine Department of Energy. All payments should be net of all
applicable foreign and local bank financial charges. An application is
not considered accepted by the DNG-REC until the processing fee is
fully paid.

The application shall be sent by courier or registered mail, or hand-
delivered and stamped-received by the DOE Records Division. It shall
be addressed to:

The Chair

Downstream Natural Gas-Review and Evaluation Committee (DNG-
REC)

Department of Energy

Energy Center, Rizal Drive cor. 34" Street, Bonifacio Global City,
Taguig City, Metro Manila, Philippines 1632

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b. Documentation.
i. Issuance of NTP.
1. Legal Documentation.

a. Duly filled-out covering information sheet showing a brief profile
of the Applicant (Annex A-1);

b. Certified true copy of Securities and Exchange Commission
registration, Articles of Incorporation and By-Laws or their
equivalent for foreign - registered Applicant. The corporate
purpose of the Applicant shall include authority to own and
operate a PDNGI facility;

c. Certified true copy of the latest General Information Sheet (GIS)
of the Applicant stamped-received by the SEC within twelve
(12) months from date of the filing of application; and

d. Certified true copy of Secretary’s Certificate showing authority
of the Applicant’s representative to apply, negotiate, sign, and
execute documents in relation to the application.

The DNG-REC, at its discretion, may require the submission of the

above-mentioned documents of the Applicant's Parent

Company/ies and/or Affiliate/s.

2. Technical Documentation.

a. Applicant profile.

An executive report indicating the following:
i. Applicant.

1. Executive summary of the business operation of the
Applicant;

2. List of executive officers and their professional
qualification and experience;

3. List of project management team and their professional
qualification and experience;

4. Organizational chart of the executive officers and the
project management team;

5. Business direction and strategy; and

6. Major accomplishments in the PDNGI Industry.

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Profile of the Applicant’s Affiliates and joint ventures.

1. Legal identity and business operation of the Applicant’s
Affiliates and joint ventures;

2. List of executive officers and their professional
qualification and experience;

3. List of project management team and their professional
qualification and experience;

4. Organizational chart of the executive officers and the
project management team;

5. Specific expertise of the Affiliate or joint venture that will
be contributed to the project; and

6. Major accomplishments of the Affiliate or joint venture in
the specific expertise to be contributed to the project.

Applicant, its Affiliates, and joint venture disclosure of any
pending or finally determined major safety or environmental
enforcement actions by relevant authorities; and

iv. Other information that the Applicant may deem necessary to

support its application or as may be required by the DNG-
REC.

. Project profile.

General project description;
Description of project site;

Applicant shall comply with the following minimum
requirements:

1. Classified as heavy industrial zone; and
2. Adequate exclusion zone.

List of permitting requirements to be secured from the
Government by the Applicant before construction;

. List of technical studies to be prepared by the Applicant

before construction;

Other pre-construction preparatory activities.

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3. Financial Documentation.

a. Work program and budget indicating the following:

Acquisition or lease of project location/site;
Permitting activities;

Technical studies; and

iv. Other pre-construction preparatory activities.

b. Financial Documents:

Certified true copy of the audited Financial Statements (FS)
for the last two (2) years from the date of the Application and
the latest unaudited FS duly signed by the President and/or
Chief Finance Officer of the company if the audited FS is
more than six (6) months at the time of application filing;

. Original copy of the bank certification on the cash balance

of the latest unaudited FS;

Board resolution appropriating funds for the work program:
and

iv. If the committed working capital is insufficient, the Applicant

may avail any of the following support funding:
1. Additional funding from equity:

Certified true copy of the Corporate Secretary’s
certification of the committed additional paid-in capital
supported by original copy of sworn letter of commitment
from interested shareholders;

2. Funding support from the Parent Company:

a. Acertified true copy of the audited FS for the last two
(2) years from the date of the application and the
latest unaudited FS duly signed by the President
and/or Chief Finance Officer of the company if the
audited FS is more than six (6) months at the time of
application filing;

b. Original copy of the bank certification on the cash
balance of the latest unaudited FS; and

c. Certified true copy of notarized board resolution
appropriating fund based on its corresponding
participating interest.

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Cc.

3. Funding support from debt financing:

Certified true copy of approved loan facility or agreement
specifically earmarked to fund the proposed work
program.

Proposed Financial Closing methodology for the proposed
PDNGI facility construction.

. Financial evaluation criteria.

The working capital as computed based on the submitted
financial documentation and the support funding shall be able
to support one hundred percent (100%) of the proposed work
program.

For the purpose of this guideline, working capital refers to the
difference between the company’s current assets (such as cash
and cash equivalents, trade and other receivables, short-term
investments, prepayment and inventories) and current liabilities
(such as short-term debts, trade and other payables). The
available working capital for each application shall be net of the
fund requirements or financial commitments from other existing
projects or service contracts with the DOE, if applicable.

ii. Issuance of PTC.

1. Legal Documentation.

a.

f.

Applicable regulatory permits from the Department of
Environment and Natural Resources (DENR) which include the
Environmental Compliance Certificate (ECC);

. Applicable Endorsement and Building Permits from the local

government unit (LGU);

. Certificate of Non-Overlap or Certification Pre-Condition (CP)

from the National Commission on Indigenous Peoples (NCIP);

. Registration from the Department of Labor and Employment

(DOLE):

. Fire Safety Evaluation Clearance from the Bureau of Fire

Protection (BFP); and

Other permits that may be required by law or rules.

2. Technical Documentation.

a.

Final project description:

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Vi.

Description of the PDNGI Facility for construction and
installation;

Plot plans and list of key buildings, components, systems,
access roads, safety zones and distances;

Description of the functions of key buildings, components,
systems, access roads, safety zones and distances;

. List and description of technologies to be employed in the

construction and installation;

Summary list with sufficient description of the Philippine or
Internationally Accepted Codes and Standards specifically
used as basis on the formulation of the plans and designs
for the construction of buildings and other facilities and the
installation of equipment including the materials used
therein; and

Other relevant detailed engineering design information.

b. Execution program:

I.

Work program and budget attached with Gantt Chart:

Detailed construction and installation work per activity with
timelines of procurement and delivery indicating the start
and completion date for each milestone;

Pre-commissioning and commissioning tests and start up
for works and milestones; and

. Description of the progress measurement system and

method applied to monitor progress of the project. The
Applicant shall use scheduling tools for ease of project
progress and schedule monitoring (i.e., XER or MPT).

c. Detailed description of the professional qualifications and
experience of the project management team for construction,
installation, testing and commissioning attached with an
organizational chart indicating the groups/sections and their
roles, functions, scope of work, etc.;

d. Detailed description of manpower complement:

e. Third-party safety and quality validation:

Safety and Quality Certificate on the design of the buildings,
other facilities, and equipment to be installed; and

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