The subsidiary of state-run National Development Co. (NDC), which entered into a 40-year-old land deal with a giant oil firm now being tagged onerous, will be shuttered by 2021, the Department of Finance (DOF) said on Wednesday (Jan. 22).
In a statement, the DOF said the NDC Board last December had decided to terminate the corporate life of Batangas Land Co. Inc. (BLCI), which leased out a 120-hectare land in San Pascual, Batangas to Chevron Philippines Inc (formerly Caltex) oil import depot.
Upon the dissolution of BLCI, the NDC would designate a team to renegotiate the lease contract with Chevron, said Finance Secretary Carlos G. Dominguez III, who heads the Duterte administration’s economic team, in text message.
Last Tuesday (Jan. 21), Dominguez said that the government will “implement a totally transparent method of getting the best deal for the rental of all [public] property” to get contracts that would be advantageous to taxpayers.
Dominguez, who sits on the NDC Board, earlier recommended the dissolution of BLCI after the DOF-attached Privatization and Management Office (PMO) found onerous provisions in the lease contract between BLCI and Chevron.
Dominguez had endorsed a review of all government deals with the private sector that could have onerous provisions.
The PMO later on found that Chevron was currently paying a monthly lease of only 74 centavos per square meter (sqm), or equivalent to just 4 percent of the current fair market rate estimated at P17.90 per sqm, for the 120-hectare land.
Dominguez had declared the BLCI-Chevron deal as another one of those contracts that had put the government at a disadvantage.
“Shortening BLCI’s corporate life will finally allow the government to exercise full ownership, control, and rights over this prime lot and other real estate properties occupied by Chevron, which are strategically located for the country’s future energy projects,” Dominguez said.
“The government should have exercised these rights as early as 1975, but Chevron was able to obtain preferential treatment to continue occupying and using these properties under the then-Marcos administration,” Dominguez added.
“These properties (including the Batangas property) should have been turned over to the government as early as the 1970s, not only legally speaking but, more importantly, based on the principle that these
properties should truly benefit the Filipino people,” the finance chief said.
“These companies were given sufficient time to transition and pass on full ownership to the government. It is now high time for the government to exercise its rights,” according to Dominguez.
Edited by TSB