Privileged and Confidential

Dra� for discussion – as of September 4, 2023

Subject: Compliance with Condi�ons of Undertaking (Executed as Precondi�on for Issuance of Cer�ficate of No Overlap in favor
of SC38 Renewal)

Background

1. A Cer�ficate of No Overlap (“CNO”) was issued by the NCIP MIMAROPA Office affirming that
Service Contract No. 38 “DOES NOT OVERLAP any Ancestral Domain/Land of Indigenous Cultural
Communi�es/Indigenous Peoples xxx.”
2. As a condi�on of the said CNO, Prime Energy submited to NCIP MIMAROPA Office an Undertaking
which states:

3. To kick off the implementa�on of this Undertaking, Prime Energy through the MFI engaged the
NCIP Palawan Office.
4. During the ini�al engagement, the requirements of the NCIP Palawa Office were as follows:
a. NCIP Palawan office asked for new agreement for Bulalacao, Coron. MFI responded that
the previous Kalatas ng Kasunduan (2012) is still in effect.
b. NCIP Palawan implied that we should spend for the CADT processing of Bulalacao. MFI
responded that MFI’s mandate is only implementation of social development and
conservation programs. Titling matters are not part of the scope. However, MFI has
contributed important marine monitoring scientific data and technical maps to their
ADSDPP (still work in progress), among the requirements for the CADT.
c. NCIP Palawan wanted Prime Energy/MFI to cover a larger geographic scope in spite of
the distance of the pipeline to certain areas and islands (in Linapacan and 11 barangays
in El Nido) because the ancestral claims overlap with the pipeline (despite what is stated
in the CNO). Maps showing such overlaps were requested.
d. NCIP Palawan wants to sign a tri-partite MOA prior to the start of consultations and
needs assessments. MFI asked for a draft of the MOA for review.
5. During the second engagement, the following matters were discussed:
a. Geographical Area of focus agreed: Coron and Linapacan only (the valida�on team will
par�cipate in the consulta�ons to be conducted)

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Privileged and Confidential
Dra� for discussion – as of September 4, 2023
Subject: Compliance with Condi�ons of Undertaking (Executed as Precondi�on for Issuance of Cer�ficate of No Overlap in favor
of SC38 Renewal)

b. MFI reminded them that the gas resource is 80kms offshore and the CNO is clear there
are no overlaps
c. NCIP Palawan insisted on the Bulalacao CADT process sponsorship and MFI repeated it is
not part of MFIs and the JVs scope
d. NCIP Palawan asked if MFI can further provide support to the comple�on of Bulalacao’s
ADSPP, CRMP, IP requirements for CADT.
e. Aty. Zosing on behalf of MFI conveyed that under the IPRA law, energy resource is among
the 4 resources outside IP jurisdic�on and that the pipeline is just passing through
Bulalacao waters being claimed.
f. NCIP Palawan insisted on a renego�a�on of the Bulalacao agreement (ie, the Kasunduan)
and submited a dra� for MFI’s considera�on.
g. MFI submited comprehensive bound documents including IP resolu�ons, program
accomplishments in Coron from 2012-present, conserva�on agreements, technical
reports. (The same will be submited to RD Pascua.)

Questions:

1. Is there legal basis for NCIP to require Prime Energy/MFI to renego�ate the exis�ng Kasunduan?
2. Is there legal basis to accommodate NCIP Palawan’s request for Prime Energy/MFI to support the
CADT Applica�on Process?
3. Is there legal basis for NCIP Palawan to insist that a larger geographical area in Palawan be included
in the programs to be implemented pursuant to the Undertaking?

Discussion:

1. Is there legal basis for NCIP to compel Prime Energy/MFI to renego�ate the exis�ng Kasunduan
(for the purpose of expanding the benefits in favor of the IPs/ICCs) on the basis of the
Undertaking?

No, there is no basis.

First. The Kasunduan was a agreement voluntarily entered into by the Tagbanua Tribe with MFI and it has
the force of law as between the par�es. It was entered into to amicably setle the legal case ini�ated by
the Tribe. As worded, the Kasunduan states no term or expiry; thus, it will con�nue to subsist unless
terminated in accordance with law or mutual agreement. Further, as it is a contract freely entered into by
the par�es, its terms may only be amended upon mutual consent.

For Prime Energy/MFI, the contract as executed is sufficient for purposes of coordina�ng with and
implemen�ng programs for the IPs/ICCs. Thus, it sees no compelling reason to amend the terms, and the
Tribe cannot compel Prime Energy/MFI to enter into a renego�a�on.

Second. Compelling the amendment of the Kasunduan is not in line with Undertaking which states that
Prime Energy’s commitment is to “ini�ate and conduct community consulta�ons xxx for the
implementa�on of development and sustainability programs in accordance with Prime Energy’s corporate
social responsibility programs.” Stated otherwise:

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Privileged and Confidential
Dra� for discussion – as of September 4, 2023
Subject: Compliance with Condi�ons of Undertaking (Executed as Precondi�on for Issuance of Cer�ficate of No Overlap in favor
of SC38 Renewal)

a. Prime Energy’s commitment is to engage in community consulta�ons. A “commitment to engage”

is not the same as a blanket commitment to indiscriminately accept requirements demanded by
an IP, or a firm commitment to extend addi�onal benefits.
b. Further, Prime Energy retained its discre�on to implement development or sustainability
programs that are “in accordance with its corporate social responsibility programs.” Prime Energy
therefore has the right to carefully evaluate and choose what kind of programs to implement or
assistance to extend.

See below:

Third. The other commitment in the Undertaking that would directly involve the IPs/ICCs is the IEC
Campaign (for the purposes of explaining the nature, scope, and significance of the Malampaya Project)—
which again, does not contemplate a mandatory grant of addi�onal benefits in favor of the IPs/ICCs. See
below:

Notably, the dra� revised Kasunduan offered by NCIP Palawan is a template where FPIC is
required/mandated by law. Requiring Prime Energy/MFI to execute this kind of agreement contradicts the
pronouncement in the CNO that the contract area of Malamapaya does not overlap with any ancestral
land or domain.

2. Is there legal basis for NCIP Palawan to require Prime Energy/MFI to support the CADT Applica�on
Process of the Tagbanua Tribe?

No, there is no legal basis.

As men�oned, Prime Energy retained its discre�on to implement development or sustainability programs
that are “in accordance with its corporate social responsibility programs.” Prime Energy’s right to evaluate
these proposals against established corporate programs must be respected by the IPs/ICCs and NCIP
Palawan.

Defraying the cost of �tling ac�vi�es for the IPs/ICCs is not in line with the corporate social responsibility
programs of Prime Energy or MFI. Prime Energy’s only commitment insofar as CADTs are concerned is to
share with NCIP further relevant informa�on for purposes of assessing and valida�ng any applica�on filed
by IPs/ICCs. In fact, MFI has already contributed important marine monitoring scien�fic data and technical
maps to their ADSDPP (albeit a work in progress), one of the requirements for the CADT.

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Privileged and Confidential
Dra� for discussion – as of September 4, 2023
Subject: Compliance with Condi�ons of Undertaking (Executed as Precondi�on for Issuance of Cer�ficate of No Overlap in favor
of SC38 Renewal)

See below:

3. Is there legal basis for NCIP Palawan to insist that a larger geographical area in Palawan must be
included in the programs to be implemented pursuant to the Undertaking?

No, there is no legal basis.

The Undertaking limits Prime Energy’s commitment for consulta�on with communi�es that are adjacent
to the gas export pipeline. See below:

Based on the maps, there are only a few key areas that may be considered adjacent to the gas export
pipeline. The ordinary meaning of the word adjacent is “next to or very near a specified loca�on”.
Consistent with this, MFI ini�ally iden�fied the islands of Decabaitot and Binalabag (in Linapacan) as areas
of focus for compliance with this condi�on of the Undertaking, which are located ~5 km or less away from
the gas export pipeline. These iden�fied areas are as shown below:

The distance of these islands from the gas export pipeline (in green line) is as shown below:

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Privileged and Confidential
Dra� for discussion – as of September 4, 2023
Subject: Compliance with Condi�ons of Undertaking (Executed as Precondi�on for Issuance of Cer�ficate of No Overlap in favor
of SC38 Renewal)

Prime Energy may also consider other communi�es in due course (such as those located adjacent to
coastal waters or municipal waters adjacent where pipeline is located), as it may so determine in
accordance with its corporate social responsibility programs.

Finally, as Prime Energy stated in the Undertaking, it shall not reduce benefits previously granted by it to
IPs/ICCs. As such, it will con�nue its work within Coron (specifically Bulalacao) and Marcilla, and other
areas where its founda�ons have already established its presence through MFI.