By Lenie Lectura - November 23, 2018
Energy Secretary Alfonso G. Cusi
said on Thursday the Philippines and China have allotted a one-year period to
discuss the recently signed memorandum of understanding (MOU) before both
countries could arrive at any firm agreement on a possible joint oil and gas
exploration.
“We have to sit down immediately and
come out with our position and we should do it. If I remember it right, within
a period of no more than one year. That is for us to come out with ways to
harness the resources, or do a joint development or joint exploration. We have
to come out with ways, or no ways. We have to put an end in that talking,” said
Cusi during the launch of the first Philippine Conventional Energy Contracting
Program (PCEP).
He also clarified that “there is no
joint exploration yet,” but only a MOU “to explore ways on how we can harness
the indigenous resources at West Philippine Sea.”
The Department of Energy (DOE) and
the Department of Foreign Affairs (DFA), he added, are closely working on the
lifting of moratorium on exploration activities involving Service Contract (SC)
72, an oil and gas exploration permit covering the Sampaguita natural-gas
prospect in the Reed Bank, to the west of Palawan.
“We want to lift it…but as we do so,
we do not want to create problems that we may not be able to handle. The DOE
and DFA, together with other government agencies, are working together to find
a solution to that problem,” Cusi said.
“We don’t want to impose a timeline
that is not within our control because there are other factors we have to
consider. But what I can tell you, we are working, moving with urgency,” he
added.
Discussions between the PXP Energy
Corp. and China National Offshore Oil Corp. for a possible
joint exploration of SC 72 had been put on hold because of the dispute
between the two countries on the area where the service contract is located.
The Philippine government had
declared force majeure on the license in 2015 due to a territorial dispute with
China then.
Meanwhile, the DOE is aggressively
promoting the PCEP to address the lack of petroleum exploration in the
country.
The DOE noted that the Philippines
is trailing behind its neighbors in upstream petroleum activities as the
country has so far drilled an average of five wells in a 10-year period.
“Five wells vis-à-vis the double and
triple digit averages of other Asean countries. We could no longer be
complacent and subject ourselves to the volatility of the global oil markets.
It is high time that we establish a sustainable petroleum exploration and
development program,” said Cusi.
PCEP seeks to encourage stakeholders
to invest, explore, develop and produce the nation’s indigenous energy
resources, he said.
“President Duterte has pushed us to
‘Build, Build, Build.’ Similarly, we have expressed our support for Sen. Win
Gatchalian’s ‘Dril, Drill, Drill.’ We build on the same momentum with the
PCEP-our battle cry—‘“Explore, Explore, Explore,’” Cusi said.
Under the PCECP, there are two modes
of application potential investors may pursue.
First, interested parties may wish
to bid on the 14 predetermined areas identified by the DOE, one in Cagayan,
three in East Palawan, three in Sulu Sea, two in Agusan-Davao, one in Cotabato
and four in West Luzon. The application period is 180 days, and will be
officially opened during the launch.
Alternatively, the applicants could
also nominate and publish other areas of interest. In this mode, applications
could be submitted at any time of the year, and would be subjected to a 60-day
challenge period.
During the launch, DOE
Undersecretary Donato D. Marcos said an initial count of “65 foreign and 200
local firms” are interested to explore the 14 predetermined areas, while some
have indicated intention to nominate other areas.”
Prior to the launch, the DOE
conducted several road shows to drum up awareness on the program, including an
international road show held in Singapore last August.
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