American firm Chevron Geothermal Philippines Holdings Inc. may finally be able to legally disentangle itself from the requirement of tapping a Filipino partner for its geothermal exploration venture because of the Renewable Energy (RE) Act provision re-defining the classification of the resource into minerals.

“They (Chevron Geothermal) already applied that they be allowed 100-percent foreign ownership in their geothermal exploration based on the provisions of the RE Law. We are now reviewing it,” Department of Energy (DoE) assistant secretary Mario Marasigan said.

The US firm, he noted, would need to work through two major legal challenges before their “Filipinization requirement” can be waived.

One step will be for them to apply for full foreign ownership under the RE Law; and the second, will be an application under the Financial or Technical Assistance Agreement (FTAA) based on the provisions of the Mining Act for large-scale exploration and development of mineral resources.

“We have recommendatory powers on their application for full foreign ownership. And when they (Chevron Geothermal) have hurdled both legal requirements, it will be the President who has the power to sign under the FTAA,” Marasigan explained.

Chevron Geothermal’s concern on Filipinization or the need to tap a local partner to take on 60-percent equity is a long-standing issue that the company has been dealing with.

In a compromise agreement it sealed with then partner National Power Corporation, the American firm was asked on its “Filipinization” or having a 60-percent local partner to comply with Constitutionality issue as to the exploitation and development of geothermal resources (i.e. steam extraction) which was previously categorized as indigenous resource, hence, inalienable under the 1987 Philippine Constitution.

Marasigan though explained that since geothermal was already re-classified as “mineral resource,” then 100-percent foreign ownership may already be allowed, as defined under the FTAA.