The Office of the Government Corporate Counsel (OGCC), acting as legal representative for PNOC, has filed a second motion for reconsideration before the Supreme Court. The motion requests the Court to revisit its previous decision, which had denied PNOC’s initial appeal and allowed the transfer of billions of pesos worth of public land to Petron Corporation without proper compensation.
Solomon Hermosura, Government Corporate Counsel, highlighted key issues in the case, including the Court of Appeals’ misinterpretation of Petron’s declaration of over 300 hectares of land as property dividends and its subsequent lease. Despite Petron’s own admission that the lease was a separate and independent transaction, the appellate court erroneously treated the two as one, raising significant legal and financial concerns.
Furthermore, Petron’s deeds of conveyance stated that it was “without prejudice to” the lease. Hermosura emphasized that the Supreme Court has interpreted this phrase to mean that the lease remains separate and independent from the dividend declaration. However, the Court of Appeals may have overlooked this principle, using PNOC’s alleged lease violation as grounds to revoke the property dividend declaration.
The motion also challenges the undervaluation of public assets caused by the appellate court’s decision. During Petron’s privatization in 1994, the government sold shares in the company but retained ownership of the land, ensuring a fair transaction. Thirty years later, the court’s ruling effectively reverses this arrangement, transferring land valued at over ₱100 billion to Petron’s private shareholders for just ₱143 million. This decision grants private shareholders an asset worth significantly more than Petron’s current market valuation of ₱23 billion, leading to substantial government losses.
The dispute centers on three lease agreements for Petron’s service stations, bulk plants, and refineries. In 2017, Petron filed a case against PNOC, alleging lease violations based on a legal opinion from the Solicitor General, which suggested the agreements breached anti-graft laws. The case raises critical issues surrounding land ownership, privatization, and lease contracts.
Citing past Supreme Court rulings that granted second motions for reconsideration in the “higher interest of justice,” the OGCC is urging the Court to revisit the case and provide a more thorough review.
Through the filing of the second motion for reconsideration, PNOC vows to remain transparent in its dealings and continue to safeguard the interests of the Filipino people.