Striking oil


When the Malampaya reserves were discovered off the waters of Palawan in 1991, and the billion-dollar, natural-gas extraction project commenced in 2002, the Philippine government found a new and considerable source of revenue. As it turns out, it wasn’t only the government that struck oil, so to speak. Operators like the alleged pork barrel scam mastermind, businesswoman Janet Lim-Napoles, found the government’s share of the Malampaya proceeds to be rich pickings indeed.

According to Merlina Suñas, one of the first six witnesses to blow the whistle on the pork barrel scam, at least P900 million in royalties from the Malampaya project intended to help Department of Agrarian Reform beneficiaries in 2009 was diverted to Napoles’ network.

To be sure, when the first details of the alleged diversion saw print, last July, a former member of the Arroyo administration seized on the allegation as proof that the entire pork barrel scam was a mere tale, an “utter fabrication.” The Department of Agrarian Reform had nothing to do with the Malampaya funds at all, he said.

But statements issued since then by officials with access to either the records or the intended beneficiaries prove that the diversion of Malampaya funds did happen. (Other witnesses and more documentary evidence have also surfaced to reinforce the whistle-blowers’ claims about the pork barrel scam itself.)

Eastern Samar Rep. Ben Evardone confirmed that Malampaya funds intended for farmers in his district went instead to nonexistent projects; the mayors in the area told him so. And Agrarian Reform Secretary Virgilio delos Reyes said in a TV interview that the department’s records showed then Undersecretary Narciso Nieto, the officer-in-charge at the time, authorizing the release of some P900 million in Malampaya funds to nongovernment organizations in 2009, including nine linked to Napoles.

That this diversion, involving a department that had nothing to do with the operation of the Malampaya project, happened at all tells us something crucial about the Malampaya funds: They are huge, and easy to abuse.

The problem begins with something fundamental: Nobody really knows exactly how much the government has earned from the Malampaya project.

The service contract that governs the project binds partners Shell Philippines Exploration B.V., Chevron Malampaya LLC, and PNOC Exploration Corp. to remit 60 percent of earnings, after certain deductions, to the national government. However, for the project’s first years, from 2002 to 2011, the Department of Budget and Management and the Department of Energy have widely differing estimates. The DBM figure as of May 2011 was P106 billion; the DOE estimate as of November 2011 was P228.45 billion. The difference in dates is material, of course, but the variance is too wide.

The problem worsens when it comes to expenditures. There is far too much leeway used to allocate the Malampaya funds. For instance, the provincial government of Palawan is still contesting the national government’s share of the earnings, but through a provisional arrangement, it has already received a considerable amount: as much as P2.5 billion, according to Sen. Teofisto Guingona III. According to the widow of broadcast journalist Gerry Ortega, a critic of the way Palawan managed its Malampaya share, the total is even higher, at P3.1 billion, with only P520 million accounted for.

The problem deepens after the funds have been used. In 2010, a Commission on Audit report found that, between 2002 and 2010, close to P24 billion in Malampaya funds had been released to government agencies and the province of Palawan, while a total of P77.2 billion lay “idle.” (Given today’s headlines about ghost projects and ghost project proponents, that may not be such a bad thing—if, that is, the money is still there.)

But, as COA Chair Grace Pulido-Tan has said, the amount released to the government in various ways (the total of P24 billion is almost equivalent to the original 2014 allocation for the congressional pork barrel) has not undergone a consolidated audit.

No wonder operators like Napoles seized on the Malampaya project: It was like finding oil in one’s own backyard.

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  • reydomingo

    “phil is rich pretending to be poor”… rich pala talaga kaya lang naging poor kasi kinurakot ng politiko ang kaban ng bayan… kasuhan at ikulong buong napoles family..

    • bulong

      we are not the sick man of asia…these thieves are sickening!!!

    • anakpinas

      don’t concentrate on politicians, Napolis is not a politician & yet she got a very very big chunk of the entire pork barrel.

  • sebastian abao

    The EO law prescribing the use of the Malampaya Funds should be superseded. Discretionary fund allocation provision should be removed or clearly limited. Records related to its administration should be open access for public monitoring, scrutiny and audit. This would definitely help deter the use of funds on ghost and overpriced projects.

  • divictes

    Ang bababoy talaga…living and feeling like oil sheiks, di naman mga arabo.

  • farmerpo

    Gloria gloria labandera. Wa na ko say. It sounds hackneyed but we have to look at the source and mother of all scammers. She is being sidelined. I bet all webs are tied to her somehow. Look at the time lines…. Masarap yatang maging Presidente no??

  • Fulpol

    whether China take the rich oil terrritory or not… it doesn’t matter to ordinary Pilipinos..

    but it matters big to corrupt…

    • AlexanderAmproz

      And the Juan de la Cruz will be used as canon-flesh to protect the corrupted and filthy rich interests…

      What a pity to be an uneducated gullible, but charming !


  • neilabarca

    Ang estimate ng marami, mahigit kumulang na $2.0 billion (P80.0 billion) ang naire-remit ng DAMBUHALANG KUMPANYA ng MALAMPAYA sa gubyerno ng PIlipinas taun-taon (annually).

    KUNG WALANG KURAKOT at nagagamit lamang sa mabuting paraan ang kinikita sa MALAMPAYA GAS FIELD, hal., sa pagpapaunlad ng ating industria at teknolohiya, baka, kasingYAMAN na ng PILIPINAS ang MALAYSIA, ang bansang may pag-aari ng PETRONAS.. NAKAKAPANG-LUPAYPAY talaga..

    At kung mayroong APAT (4) na MALAMPAYA GAS FIELD ang Pilipinas, baka kasing YAMAN na natin ang SINGAPORE, kung ZERO-CORRUPTION ang PILIPINAS katulad ng SINGAPORE…

  • virgoyap

    It’s only during the appearance of Napoles that the Malampaya project becomes clear to me. So it involves billions of pesos at hindi nakikinabang nito ang taong bayan. Disgusting!!

  • jpastor

    Kailangan dito managot lahat ng may kasalanan.
    Kung walang na lethal injection bogbog sarado tapos kulong ang mga yan pwede?

  • tarikan

    Merun ng namatay dyan sa Malampaya fund scandal. Merun ng mga tumakas. At merun pang mga makukulong. Ma’am Janet kamusta na, mataas pa ba BP mo? Si sir Jim patulugin mo paminsan-minsan diyan sa Sta. Rosa para naman colored ang panaginip mo. Hwag kang maniwala na inaasikaso kaso mo baka iba na ang inaasikaso hmmm.

  • disqus_EWrSdjV1nv

    pakicheck ang relihiyon ng mga nakinabang sa scam na ito. kasi yung pari sa quiapo eh kumukubra ng 150,000 kada hinihiram ang black Nazarene eh VATABLE transaction na yan for rent. bat hindi hinahabol ni henaros ang mga ito?

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