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Senate reso to probe Malampaya fund anomalies filed

MALAMPAYA, PALAWAN, Philippines – The offshore platform of Malampaya Deepwater Gas-to-Power project, stands some 80 km west of Northern Palawan, pictured on 18 March 2017. It extracts natural gas deposits under the sea bed of West Philippine Sea, which are then supplied to power generating facilities in Batangas thru an underwater pipeline, thus sustaining almost half of Luzon’s power needs. Senate Committee on Energy chairman Senator Win Gatchalian wants a full-scale probe on how the government spent its share of income from the Malampaya project. Photo by Mark Cayabyab/OS WIN GATCHALIAN

Senator Win Gatchalian is calling for a full-scale Senate investigation into billions of pesos worth of anomalous disbursements of Malampaya funds under the past two administrations.

Senate Resolution No. 579, filed by Gatchalian on Tuesday, directs the appropriate Senate committee to conduct an inquiry, in aid of legislation, “on the release of the Malampaya Funds by the Department of Budget and Management without complete documentary requirements in violation of Presidential Decree No. 910 Series of 1976, Executive Order No. 683 Series of 2007, DBM-DOE-DOF Joint Circular No. 3 Series of 2008, and other relevant laws and rules and regulations as specified in the Commission on Audit’s Special Report No. 2017-04.”

The Malampaya Fund, which holds the government’s profit share from the exploitation of natural gas resources in the Camago-Malampaya Reservoir under Service Contract 38, accrued P173.280 billion from the operations between January 2002 until June 2013.

These funds were collected by the Department of Energy and managed by the Bureau of Treasury for the exploration and development of energy resources. In 2007, the DBM was authorized to release money from the Fund according to certain guidelines.

However, a COA special report issued in 2017 revealed that Special Allotment Release Orders (SAROs) and Notices of Cash Allocations (NCAs) were issued with incomplete documentary requirements, such as the lack of project proposals, requests for funds from the implementing agencies, proof of DBM evaluation, or approval by the President.

As of May 21, 2012, a total of P38.8 billion of public funds has been released by DBM to various non-government agencies, government-owned and controlled corporations, and the provincial government of Palawan.

“These funds were meant to finance the development of energy resources . Their usage for other purposes, and without following the clear procedural requirements concerning their disbursement, is a serious cause for concern that must be looked into by the government,” said Gatchalian, chairman of the Senate Committee on Energy.

“Considering the large amount of public funds involved, I believe an immediate inquiry is necessary to hold erring public officers responsible for the irregular release of these funds, and to prevent future illegal exploitation of these funds,” he added.