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WHEREAS, the 1987 Constitution provides that all lands of the public domain, waters, minerals, coal, petroleum and other natural resources are owned by the State and that the exploration, development and utilization of natural resources shall be under the full control and supervision of the State;

WHEREAS, Section 4 of Republic Act (R.A.) No. 7942, otherwise known as the Philippine Mining Act of 1995, provides that mineral resources are owned by the State; that the exploration, development, utilization and processing thereof shall be under the State's full control and supervision and that the State may directly undertake such activities;

WHEREAS, Section 8 of R.A. No. 7942 provides that the Department of Environment and Natural Resources (DENR) shall be the primary government agency responsible for the conservation, management, development and proper use of the State's mineral resources including those in reservations, watershed areas and lands of the public domain;

WHEREAS, pursuant to Executive Order No. 786 dated 19 March 1982, the Natural Resources Development Corporation (NRDC) as a government corporation and corporate arm of the DENR is mandated to help promote the development of the country's natural resources;

WHEREAS, Section 9 of R.A. No. 7942 provides that the Mines and Geosciences Bureau (MGB) shall have direct charge in the administration and disposition of mineral lands and mineral resources, both inland and offshore;

WHEREAS, Presidential Decree (P.D.) Nos. 3 and 3-A provides that reclamation of areas under water is limited to the National Government or any person authorized by it under a proper contract;

WHEREAS, pursuant to P.D. No. 1084 and Executive Order No. 525, the Public Estates Authority (PEA) has been created and designated as the agency primarily responsible for integrating, directing and coordinating all reclamation projects for and on behalf of the National Government;

WHEREAS, in P.D. No. 1084, the PEA is authorized to reclaim land, including foreshore and submerged areas, by dredging, filling or other means, and to acquire reclaimed land;

WHEREAS, sand, gravel and other dredgefill materials from offshore submerged lands are highly suitable raw materials for reclamation projects of the PEA and other civil works related to government projects;

WHEREAS, it is in the public interest to prioritize government projects to enhance the delivery of services vital to the Government's economic and social development programs;

WHEREAS, it is very necessary to ensure adequate, low-cost and continuous supply of raw materials in order not to hamper or delay the implementation of projects implemented by the Government, or large-scale projects that involve the interests of the State;

WHEREAS, offshore areas constitute a fragile environment such that any mining operation therein can cause environmental impacts unless the appropriate safeguards are set in place under the close supervision of the DENR.

NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:

SECTION 1. Authority to Utilize Areas Not Covered by Approved Mining Permits/Contracts as Borrow Areas for Reclamation Projects. — Considering that existing and future reclamation projects are deemed vital to the country's socio-economic development, the Government thru the DENR, NRDC and PEA, has the right to utilize the areas not covered by approved mining permits/contracts, including areas covered by pending mining applications, as borrow areas for dredgefill materials for such reclamation projects.

Surveys, sampling, site selection, dredging, and related operations in borrow areas shall be subject to monitoring by the DENR, for compliance with existing mining and environmental laws, rules and regulations, and other applicable guidelines.

SECTION 2. Responsibilities of the PEA and the DENR. — The PEA shall be responsible for the approval of bids for contracts of work for reclamation projects: Provided, That the winning bidder shall have the priority for the use of identified borrow areas, subject to the qualification requirements under R.A. No. 7942 regarding the rights to explore, develop, utilize and dispose of mineral resources: Provided further, That should the said winning bidder fail to meet such qualification, the DENR thru the NRDC shall be the permittee to undertake the quarry operations in the borrow areas. For this purpose, NRDC may avail of the services of service contractor(s).

The PEA or its contractor(s) may undertake the identification of such borrow areas, subject to the verification and approval by the DENR, taking into account the appropriate guidelines to be formulated by the DENR.

Borrow areas which are not utilized for any existing or proposed reclamation projects or programs of PEA, shall be within the jurisdiction of the DENR. The DENR-MGB shall be solely responsible for the approval of mining right applications over such areas.

SECTION 3. Taxes, Royalties and Fees. — Save in cases provided by law, taxes and royalties shall be collected from the permittees and/or contractors/ subcontractors. Likewise, the DENR or thru NRDC is authorized to collect management, service, environmental user's and other fees from the permittees and/or contractors/subcontractors. Such fees shall be shared as follows: 40% to NRDC; 40% to PEA and 20% to Local Government Unit(s) concerned.

SECTION 4. Implementing Rules and Regulations. — The DENR and the PEA shall formulate and issue the necessary rules and regulations to implement this Order.

SECTION 5. Repealing and Amending Clause. — All orders, rules and regulations or parts thereof which are inconsistent with any of the provisions of this Order are hereby repealed or amended accordingly.

SECTION 6. Effectivity. — This Order takes effect fifteen (15) days upon publication in a newspaper of general circulation.

Adopted: 30 Sept. 1999

BY THE PRESIDENT:

(SGD.) RONLADO B. ZAMORA
Executive Secretary