By Angelica Y. Yang, Reporter

THE National Commission on Indigenous Peoples (NCIP) said indigenous groups withdrew their consent for three hydroelectric plants run by Aboitiz Power Corp. unit Hedcor in Bakun, Benguet in a dispute over royalties.

The NCIP’s regional office in the Cordillera Administrative Region (CAR) had issued a cease-and-desist order (CDO) on Hedcor, requiring it to halt operations at the hydro plants due to the dispute over IP consent. The affected facilities in Bakun are the 2.4-megawatt (MW) Lower Labay, 3.6-MW Lon-oy, and 5.9-MW FLS hydro facilities.

NCIP had ordered Hedcor to shut down the three plants within five days after receiving the order.

The order, obtained by BusinessWorld last week, indicated that indigenous groups “revoked” a memorandum of agreement (MoA) signed in 2019 through a resolution of non-consent issued earlier in April due to “highly disadvantageous conditions in the deal” and the “Hedcor’s alleged use of the memorandum as a tool to unduly exert pressure on the Bakun local government unit officials to yield to (the company’s) demands.”

“On April 22, 2021, the NCIP received the resolution of ICCs (Indigenous Cultural Communities)/IPs (indigenous peoples) requesting issuance of a CDO,” according to the order.

“We issued a CDO as a legal and necessary consequence of a resolution of non-consent,” NCIP-CAR Concurrent Director IV Marlon P. Bosantog told BusinessWorld by phone last week.

He said one of the main disagreements stems from royalty issues following the expiry of an initial deal signed in 1991.

“In the 1991 MoA, (the tribes) were to receive around P5 to P7 million a year in terms of royalty and projects. What Hedcor offered after (the MoA’s) expiry following 25 years is just around P500,000,” he said.

“Convinced of the decision of the ICCs/IPs and the urgency of their request, the NCIP Regional Office sent a letter dated May 3 to Hedcor reminding them of the final decision of the host communities to reject the power plant projects and their obligation to turn over the parcels of land hosting the three power plants to the Bakun ICCs/IPs,” according to the order.

The order, which is now in effect, can only be lifted if Hedcor submits proof that it had secured a certificate precondition (CP) and the free prior informed consent (FPIC) of the tribes in Bakun, Benguet, as required by law.

In a separate disclosure filed on June 23, Hedcor said through its parent firm Aboitiz Power Corp. that it had complied with all the conditions when it sought the FPIC.

“We believe that we have been compliant with all the requirements during the course of the FPIC application process, and have been waiting for the issuance of the CP since the FPIC-MoA was signed,” Hedcor’s Vice-President for Corporate Services Noreen Marie N. Vicencio was quoted as saying.

Hedcor also said it will continue to actively reach out to the community for a customary tongtongan or gathering with the tribes, under the guidance of the NCIP.