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SUPREME COURT REPORTS ANNOTATED VOLUME 722

Information | Reference (POA) over the determination of the qualification of applicants.—

Nowhere in Section 77 of the Republic Act No. 7942 is there a
Case Title: grant of jurisdiction to the Panel of Arbitrators over the
NARRA NICKEL MINING AND determination of the qualification of applicants. The Philippine
DEVELOPMENT CORP., TESORO
MINING AND DEVELOPMENT, Mining Act clearly requires the existence of a “dispute” over a
INC., and MCARTHUR MINING, mining area, a mining agreement, with a surface owner, or those
INC., petitioners, vs. REDMONT
CONSOLIDATED MINES CORP., pending with the Bureau or the Department upon the law’s
respondent. promulgation. The existence of a “dispute” presupposes that the
Citation: 722 SCRA 382 party bringing the suit has a colorable or putative claim more
superior than that of the respondent in the arbitration
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proceedings. After all, the Panel of Arbitrators is supposed to
provide
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binding arbitration which should result in a binding award either

in favor of the petitioner or the respondent. Thus, the Panel of
Arbitrators is a qualified quasi-judicial agency. It does not
perform all judicial functions in lieu of courts of law.
Same; Same; Mineral Agreements; View that a mineral
agreement shall grant to the contractor the exclusive right to
conduct mining operations and to extract all mineral resources
found in the contract area.—In Section 26 of the Mining Act, “[a]
mineral agreement shall grant to the contractor the exclusive
right to conduct mining operations and to extract all mineral
resources found in the contract area.” There are three (3) forms of
mineral agreements: 1. Mineral production sharing agreement
(MPSA) “where the Government grants to the contractor the
exclusive right to conduct mining operations within a contract
area and shares in the gross output [with the] contractor x  x  x
provid[ing] the financing, technology, management and personnel
necessary for the implementation of [the MPSA]”; 2. Co-
production agreement (CA) “wherein the Government shall
provide inputs to the mining operations other than the mineral
resource”; and 3. Joint-venture agreement (JVA) “where a joint-
venture company is organized by the Government and the
contractor with both parties having equity shares. Aside from
earnings in equity, the Government shall be entitled to a share in
the gross output.”
Same; View that the purpose of the sixty per centum
requirement is obviously to ensure that corporations or
associations allowed to acquire agricultural land or to exploit
natural resources shall be controlled by Filipinos.—The rationale
for nationalizing the exploration, development, and utilization of
natural resources was explained by this court in Register of Deeds
of Rizal v. Ung Siu Si Temple, 97 Phil. 58 (1955), as follows: The
purpose of the sixty per centum requirement is obviously
to ensure that corporations or associations allowed to acquire
agricultural land or to exploit natural resources shall be
controlled by Filipinos; and the spirit of the Constitution
demands that in the absence of capital stock, the controlling
membership should be composed of Filipino citizens.
Same; Grandfather Rule; View that the conclusion that the
Grandfather Rule “applies only when the 60-40 Filipino-foreign
equity ownership is in doubt” is borne by that opinion’s
consideration

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