Published November 21, 2018, 10:00
PM By Myrna
M. Velasco
The country – via the efforts of the
Department of Energy (DOE) – will place its bet again on prospective oil and
gas discovery, and it expects to get this moving headway in this week’s
launching of the government-designed Philippine Conventional Energy Contracting
Program (PCECP).
A mix of close to 300 industry
players as well as interested investors have confirmed their attendance in the
formal kick-off of the petroleum contracting round this November 22.
Energy officials further tipped off
that interested parties in the petroleum service areas to be offered comprise
of local as well as cash-rich and well-experienced global players.
Under the tutelage of the PCECP, the
DOE will be offering 14 pre-determined oil and gas blocks to interested
parties. The other facet of the Duterte administration-designed petroleum
contracting is the year-round nomination of the preferred service areas of the
investors.
The pre-determined areas comprise of
14 service areas along six basins in various parts of the country. Altogether,
they straddle 73,576.66 square kilometers of both shallow and deep-water
drilling prospects in East Palawan, Cagayan, West Luzon, Sulu Sea, Cotabato and
Agusan-Davao basins.
At its international roadshows, the
energy department has initially stirred up the interest of several big-ticket
investors – those that have deep pockets and with extensive investment
experiences in global oil and gas development domains.
The true test of their interest,
however, will only come at a time when they finally join the bidding for the
PCECP areas or when they start submitting proposals on their hand-picked
blocks.
For the pre-determined areas, the
DOE explained that investment-offer will include a data package with an
applicable application fee of non-refundable P200,000. The application period
is for 180 days.
In the nominated areas,
investor-applicants can submit their preferred petroleum block to the DOE; and
the nominating party shall be undertaking the publication of such at its own
expense. The application is also at P200,000, but it will be subject to a
60-day challenge period – wherein the challenger will be posting a fee of P1.0
million.
On evaluation of the offers, the
criteria set forth by the Centralized Review and Evaluation Committee (C-REC)
of the DOE shall be on these ratings: 40-percent for the work program
submitted; 20 percent on technical qualifications and 40 percent on financial
qualifications. Legal qualifications shall be rated either “pass or fail”
depending on the completeness and validity of required legal documents.
In terms of incentives, it will be a
60:40 royalty sharing arrangement in favor of the Philippine government and in
keeping with the provisions of President Decree 87 or the Philippine Oil and
Gas Law.
Petroleum service contractors shall
also be entitled to Filipino Participation Incentive Allowance (FPIA) at a
minimum of 1.5-percent and maximum of 7.5-percent of gross proceeds; cost
recovery of up to 70-percent of gross income from petroleum production in any
calendar year with the unrecovered costs to be carried over in the succeeding
calendar years.
When it comes to importation of
equipment, they shall also be exempted from all levies, tariffs, duties,
compensating tax and value added tax.
There is also a provision for
special income tax for sub-contractors which is 8.0-percent of gross Philippine
tax; and for their foreign employees, 15-percent of gross Philippine tax.
No comments:
Post a Comment