Energy Secretary Raphael Lotilla has emphasized the high stakes surrounding the Philippine National Oil Co.’s (PNOC) legal battle against Petron Corp., warning that the disputed 347-hectare property is a critical government asset with major implications for the country’s energy security. If the Supreme Court upholds the Court of Appeals ruling, the land—valued at P100 billion—could be transferred entirely to Petron Corp., raising concerns that it may be used primarily for private profit rather than public energy infrastructure and development.
The Office of the Government Corporate Counsel (OGCC), acting on behalf of PNOC, has filed a second motion for reconsideration before the Supreme Court, challenging the appellate court’s decision that allowed Petron to take control of the large government-owned land area without compensation. Lotilla, who also serves as PNOC chairman, defended the decision to pursue further legal action, stating that the case goes beyond financial considerations and directly affects the Philippines’ long-term energy security.
Lotilla, in an interview with ANC, stressed that the land in question, which currently houses Petron’s refinery, could serve other critical energy functions in the future, particularly as the Philippines shifts towards cleaner energy sources.
“And so, as we transition to cleaner technologies and even when, for example, with heightened electrification in the transport sector, there will come a time that petroleum will no longer be as important as it is today. And that means even the future of the refinery will not be as bright as it is right now. It will still be for some time. But by that time, the value of the land will be bigger,” he said.
The government argues that if the land remains under state ownership, it could facilitate future energy projects, including renewable energy hubs, power generation facilities, or infrastructure essential for national energy resilience.
The dispute traces back to the privatization of Petron Corp. in 1994, when the Supreme Court originally ruled that the company’s privatization process did not include the transfer of the land asset in its pricing. However, the Court of Appeals’ recent decision reversed that position, granting Petron ownership rights over the government property.
Government Corporate Counsel Solomon Hermosura raised several legal concerns regarding the appellate court’s ruling, particularly its misinterpretation of Petron’s land lease agreements. Hermosura argued that while Petron itself acknowledged that the lease agreement was a separate transaction, the Court of Appeals erroneously treated the land transfer as part of Petron’s privatization deal, effectively allowing the company to claim full ownership without just compensation to the government.
The OGCC pointed out that the Supreme Court has previously granted second motions for reconsideration in landmark cases where overriding public interest was at stake, urging the high court to re-examine the case in the interest of national energy security.
Through the second motion for reconsideration, PNOC has vowed to remain transparent in its legal actions and to safeguard the interests of Filipino citizens. Lotilla underscored the economic and strategic risks of losing government control over the property, stating that its retention would allow PNOC to channel it into future energy infrastructure projects.
“If the property assets are transferred to Petron, there’s also the possibility that they’d rather use it for profit, not for infrastructure and economic development, right? Which is the government’s function, that PNOC, if it owns it, then it would be able to use the property primarily in order to facilitate investments in energy,” he said.
With PNOC pushing for the Supreme Court to reconsider the land transfer ruling, industry experts and energy stakeholders are closely watching how the legal battle will unfold. If PNOC succeeds in its motion for reconsideration, the government could regain control of one of the most strategically important energy sites in the country, preserving it for national development and energy security projects.
The Supreme Court’s decision will not only determine the fate of the disputed land but also set a precedent for future cases involving public assets and private sector interests.
Should the government retain control of the 347-hectare land for energy infrastructure? Or should Petron be granted full ownership based on its past agreements? Share your thoughts in the comments below, and follow Power Philippines for the latest updates on energy and policy developments!
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