Tuesday, April 10, 2018

DOE eyeing $2.4-B investments in new petroleum contracting round


Published By Myrna M. Velasco

The Department of Energy (DOE) is gunning for investments of up to $2.376 billion (roughly P124 billion at current peso-dollar exchange rate) on the country’s newly launched and modified petroleum contracting round – to be fetched both from unsolicited bids and offers of State-selected petroleum blocks.
The targeted scale of investments had been initially propped by “unsolicited tenders” on six service areas already cornered by the department.
These were submitted by two Filipino-led investor-groups, namely: the Toquero Group or the consortium of Western Sulu Gulf Oil Corporation, Sulubasin Oil and Gas Corp, Seabed Crescent Energy Corp. and Offshore Celebes Energy Corporation which had been been eyeing at least four service areas; and the two other areas covered the offer of Constellation Energy Corporation.
Energy Undersecretary Donato D. Marcos disclosed that the first ‘unsolicited proposals’ received by the DOE “are from rookie players and are applying for underexplored areas” within the Sulu Sea basin in Mindanao and Ragay Gulf in Luzon’s Bicol Peninsula.
Marcos indicated that several other firms are also eyeing petroleum blocks along Ragay Gulf, West Luzon and Philippine Rise areas, but he noted formal tenders have yet to be submitted.
For the six areas alone that are of ‘unsolicited bids’ stature, total investments could be as high as US$216 million – covering work phases from geological and geophysical surveys, acquisition of data and up to the drilling of about three exploration and appraisal wells.
Marcos expounded if all six petroleum service contracts (PSCs) will be awarded, the sub-phases component of their work program will call for capital expenditures of US$36 million per service contract.
On top of that, the energy department is also scheduling soon the offer of 14 petroleum blocks as pre-determined areas (PDAs) in the repackaged Petroleum Conventional Energy Contracting Program. These comprise of four areas in West Luzon basin; three areas in East Palawan; three blocks in Sulu Sea; two areas in Cotabato; and one each in Cagayan and Agusan-Davao basins.
For these government-predetermined blocks, targeted investments had been set higher because the areas are combination of eight shallow and six deep water seismic survey and exploration activities.
Marcos explained that drilling cost per well in shallow waters amount to US$15 million; while those in deep waters will require capital outlay of US100 million per well.

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