GMA order creating new oil and energy office put on hold

To avoid conflict and controversy, President Arroyo has put on hold the implementation of Executive Order No. 474 creating an office to specifically handle programs and possible investments in alternative and renewable energy sources.

Executive Secretary Eduardo Ermita said yesterday the President would not want to encroach on the powers of Energy Secretary Raphael Lotilla and his department since Energy Undersecretary Peter Anthony Abaya was earlier named head of the Philippine Strategic Oil, Gas, Energy Resources and Power Infrastructure Office.

"The President ordered a review of the EO before it is implemented. She asked that it be held until such time that everything is clarified," Ermita said.

He added that they may "have to amend some of the provisions to prevent any misunderstanding between the energy secretary and the undersecretary named to the position."

Ermita admitted Lotilla was not consulted before the EO was crafted but he denied the energy secretary threatened to resign because the new office would render him inutile.

"There was no proper coordination and so the President asked that everything be straightened out (after) adverse reactions started to float. We do not want to create chaos in the administration of (the Department of Energy or DOE)," Ermita said.

Ermita disclosed he personally discussed the matter with Lotilla, who is on a trip to New Zealand for an official engagement.

"He’ll be arriving tomorrow (Saturday). It’s not true that he submitted a letter of resignation. They were just mere speculations. He did not consider that," he said.

Ermita said Lotilla told him that he "would not do anything that would sow trouble among us" and assured that he would not "yield to anything that would cause dysfunction at the DOE."

Under EO 474, the President created the energy body to promote, assist and fast-track crucial private sector-led oil, gas, energy resources, power and other energy projects to avert an imminent energy crisis.

The office is to be headed by Abaya as energy undersecretary and presidential assistant, Ermita said. This body will be under the Office of the President but based at the DOE.

However, some critics said it would only generate a "power play" among DOE officials and even overlap with the functions of the energy secretary, the Philippine National Oil Co. (PNOC) and Power Sector Assets and Liabilities Management (PSALM) Corp.

But according to Abaya, the EO says nothing about taking over the PNOC’s job of developing oil and gas resources or PSALM’s task of privatizing power generation and transmission assets, particularly the National Power Corp.

He said it would just promote and assist in fast-tracking the implementation of private sector-led projects.

Citing the need for such an office, the President said major foreign banking and international financial institutions had expressed interest in entering into financing agreements with the Philippine government to assist the private sector in developing the country’s energy resources for cheaper alternative fuels and power supplies.