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July 29, 1987

Excellency:

I have the honor to refer to Your Excellency's Note dated 22 December 1986 the text of which is quoted hereunder:

"I have the honour to refer to the negotiations held between our two Governments in Bonn on 13 and 14 August I985 (Summary Record of Negotiations, item 3.2.2.2) and to propose on behalf of the Government of the Federal Republic of Germany that, in pursuance of the Agreement of 7 September 1971 between our two Governments concerning Technical Co-operation, the following Arrangement on the project Mining Consultancy for the PNOC-CC be concluded.

1. The Government of the Federal Republic of Germany and the Government of the Republic of the Philippines shall cooperate in modernizing the operative collieries of the Philippine National Oil Company - Coal Corporation (PNOC-CC) and in planning new collieries, with a view to increasing the underground extraction and production figures while enhancing the safety of the colliery employees,

2. The Government of the Federal Republic of Germany' shall make the following contributions to the project

(1) It shall

(a) second up to 11 experts in

- coal-mining
  - coal beneficiation
  - extraction engineering,
  - hoisting and conveying,
  - ventilation engineering and safety,
  - mining planning,
  - dressing practice,
  - geology and hydrology,
  - training, and
  - electronic data processing,

for a total of up to 105 man/months

(b) second, as required, short-term experts with various qualifications for a total of up to 16 man/months.

(2) It is also prepared to meet the cost of accommodation of the seconded experts and their families, in so far as this cost is not met by the experts themselves.

3. The Government of the Republic of the Philippines shall make the following contributions to the projects:

It shall

(1) afford the seconded experts any assistance they may require in carrying out the tasks assigned to them and make available all necessary data, information, records and documents;

(2) appoint at least one counterpart with adequate professional qualifications for each of the seconded experts and ensure that these counterparts are pledged to work with the seconded experts on the joint project tasks during the ' period of the experts' assignment. It shall also designate one head counterpart to serve as the responsible intermediary;

(3) make available suitably equipped and air-conditioned working premises for the seconded experts;

(4) meet the entire cost of official travel by the seconded experts with the Philippines;

(5) undertake to provide suitable and air-conditioned accommodation outside Cebu City at the various project sites and meet the resulting costs;

(6) make available at the collieries the requisite working clothing and all customary protective material;

(7) guarantee the highest possible level of safety for the seconded experts at their places of work.

4. (1) The seconded experts shall have the following tasks:

(a) advise and assist the PNOC-CC in the development, planning, implementation and application of new appropriate extraction, hoisting and conveying methods in Philippine hard-coal mining;

(b) advise, assist and, if necessary, train Philippine experts in the use of new methods ;

(c) advise and assist the PNOC-CC in solving problems with regard to the opening and preparation of seams, underground transport and subsequent stages of the production process;

(d) advise and assist the PNOC-CC in introducing safety regulations for underground and surface operations

(e) advise and assist the PNOC-CC in improving the efficiency and solving problems related to the operation of its coal beneficiation plant.

(2) The seconded experts shall, within the scope of the tasks referred to in sub-paragraph 1 above, be responsible in professional matters to the PNOC-CC, in so far as this does not affect their contractual relations with their German employer.

5. (1) The Government of the Federal Republic of Germany shall charge the Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ) GmbH, 6236 Eschborn, with the implementation of its contributions.

(2) The Government of the Republic of the Philippines shall charge the Philippine National Oil Company - Coal Corporation (PNOC-CC) with the implementation of the project.

(3) The agencies charged pursuant to sub-paragraphs 1 and 2 above shall jointly lay down details of the implementation of the project in a plan of operations or in some other appropriate form, adapting them as necessary in line with the progress of the project.

6. In all other respects the provisions of the Agreement of 7 September I971, including the Berlin clause (Article 9), shall apply to the present Arrangement.

If the Government of the Republic of the Philippines agrees to the proposals contained in paragraphs 1 to 6 above, this Note and the Note in reply thereto expressing your Government's agreement shall constitute an Arrangement between our two Governments, to enter into force on the date of your Note in reply.

Accept, Excellency, the assurance of my highest consideration."

I have the honor to inform Your Excellency that my Government agrees to the proposal contained in paragraphs 1 to 7 quoted above 3 and that Your Excellency's Note and this Note shall constitute an Arrangement between our two Governments, to take effect on the date of this reply.

Accept, Excellency, the renewed assurances of my highest consideration.

(Sgd.) SALVADOR H. LAUREL
  Vice President
  Secretary of Foreign Affairs

His Excellency
Dr. Peter Scholz
Ambassador of the Federal Republic of Germany
Citibank Center Bldg., Paseo de Roxas
Makati, Metro Manila

COURTESY TRANSLATION

Manila, 22 December 1986

Excellency,

I have tbe honour to refer to the negotiations hsid between our two Governments in Bonn en 13 and 14 August 1985 (Summary Record of Negotiations, item 3.2.2.2) and to propose on behalf of the Government of the Federal Republic of Germany that, in pursuance of the Agreement of 7 September 1371 between our two Governments concerning Technical Cooperation, the following Arrangement on the project Mining Consultancy for the PNOC-CC be concluded.

1. The Government of the Federal Republic of Germany and the Government of the Republic of the Philippines shall co-operate in modernizing the operative collieries of the Philippine National Oil Company - Coal Corporation (PNOC-CC) and in planning new collieries, with a view to increasing the underground extraction and production figures while enhancing the safety of the colliery employees.

2. The Government of the Federal Republic of Germany shall make the following contributions to the Project:

(1) It shall

(a) second up to 11 experts in

- coal-mining,
  - coal beneficiation,
  - extraction engineering,
  - hoisting and conveying,
  - ventilation engineering and safety,

1. The Government of the Republic of the Philippines shall make the following contributions to the projects:

It shall

(1) afford the seconded experts any assistance they may require in carrying out the tasks assigned to them and make available all necessary data, information, records and documents;

(2) appoint at least one counterpart with adequate professional qualifications for each of the seconded experts and ensure that these counterparts are pledged to work with the seconded experts on the joint project tasks during the ' period of the experts' assignment. It shall also designate one head counterpart to serve as the responsible intermediary;

(3) make available suitably equipped and air-conditioned working premises for the seconded experts;

(4) meet the entire cost of official travel by the seconded experts with the Philippines;

(5) undertake to provide suitable and air-conditioned accommodation outside Cebu City at the various project sites and meet the resulting costs;

(6) make available at the collieries the requisite working clothing and all customary protective material;

(7) guarantee the highest possible level of safety for the seconded experts at their places of work.

1. (1) The seconded experts shall have the following tasks:

(a) advise and assist the PNOC-CC in the development, planning, implementation and application of new appropriate extraction, hoisting and conveying methods in Philippine hard-coal mining;

(b) advise, assist and, if necessary, train Philippine experts in the use of new methods ;

(c) advise and assist the PNOC-CC in solving problems with regard to the opening and preparation of seams, underground transport and subsequent stages of the production process;

(d) advise and assist the PNOC-CC in introducing safety regulations for underground and surface operations

(e) advise and assist the PNOC-CC in improving the efficiency and solving problems related to the operation of its coal beneficiation plant.

(2) The seconded experts shall, within the scope of the tasks referred to in sub-paragraph 1 above, be responsible in professional matters to the PNOC-CC, in so far as this does not affect their contractual relations with their German employer.

3. (1) The Government of the Federal Republic of Germany shall charge the Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ) GmbH, 6236 Eschborn, with the implementation of its contributions.

(2) The Government of the Republic of the Philippines shall charge the Philippine National Oil Company - Coal Corporation (PNOC-CC) with the implementation of the project.

(3) The agencies charged pursuant to sub-paragraphs 1 and 2 above shall jointly lay down details of the implementation of the project in a plan of operations or in some other appropriate form, adapting them as necessary in line with the progress of the project.

4. In all other respects the provisions of the Agreement of 7 September 1971, including the Berlin clause (Article 9), shall apply to the present Arrangement.

If the Government of the Republic of the Philippines agrees to the proposals contained in paragraphs 1 to 6 above, this Note and the Note in reply thereto expressing your Government's agreement shall constitute an Arrangement between our two Governments, to enter into force on the date of your Note in reply.

Accept, Excellency, the assurance of my highest consideration.

His Excellency
Salvador H. Laurel
Vice-President
Secretary of Foreign Affairs
of the Republic of the Philippines