6.

Utilization of natural resources

A. Miners Association vs Factoran Jr.
Facts: The petition seeks a ruling from this court on the validity of two Administrative
Orders 57 and 82 issued by the Secretary of the Department of Environment and Natural
Resources to carry out the provisions of Executive Orders 279 and 211. This petition
arose from the fact that the 1987 Constitution provided for a different system of
exploration, development and utilization of the country’s natural resources. Unlike the
1935 and 1973 Constitutions that allow the utilization of inalienable lands of public
domain through “license, concession or lease”, the 1987 Constitution provides for the full
control and supervision by the state of the exploration, development and utilization of the
country’s natural resources. Pres. Cory Aquino promulgated EO 211, which prescribes
the interim procedures in the processing and approval of applications for the exploration,
development and utilization of minerals in accordance to the 1987 Constitution. In
addition, Pres. Aquino also promulgated EO 279 authorizing the DENR Secretary to
negotiate and conclude joint venture, co-production or production-sharing agreements for
the exploration, development and utilization of mineral resources and prescribing the
guidelines for such agreements and those agreements involving technical or financial
assistance by foreign-owned corporations for large-scale exploration, development, and
utilization of minerals. In line with EO 279, the DENR Secretary issued AO 57
“Guidelines of Mineral Production Sharing Agreement under EO 279” and AO 82
“Procedural Guidelines on the Award of Mineral Production Sharing Agreement (MPSA)
through negotiation. Petitioner, Miners Association of the Philippines, mainly contend
that the DENR Secretary issued both AOs 57 and 82 in excess of his rule-making power
because these are inconsistent with the provisions of EO 279.

Issue: whether AO Nos. 57 and 82, which are promulgated by the DENR, are valid and
constitutional

Held: AO Nos. 57 and 82 are both constitutional and valid. This is due to the fact that EO
279, in effect, gave the Secretary of Natural Resources the authority to conclude joint
venture, co-production, or production sharing agreements for the exploration,
development and utilization of mineral resources. Furthermore, the constitutionality of
these administrative orders goes to show that the utilization of inalienable lands of public
domain is not merely done through “license, concession or lease” since the options are
now also open to the State through direct undertaking or by entering into co-production,
joint venture, or production sharing agreements.