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Time for Philippines to proceed with Reed Bank oil exploration — solon 

DOE.GOV.PH

THE SUSPENSION of drilling activities in the Reed Bank, locally known as Recto Bank, should be lifted now that negotiations for a supposed joint exploration between Manila and Beijing has been terminated, a lawmaker said on Sunday.  

“Now that the talks have been terminated, the department should withdraw its suspension order,” Surigao del Sur Rep. Johnny T. Pimentel said in a statement, referring to the Department of Energy (DoE). 

“This way, the private parties contracted by the Philippine government to develop the offshore Sampaguita gas discovery in Recto Bank can proceed with their drilling activities,” said the chair of the House Strategic Intelligence Committee.  

The Energy department on Saturday said it “continues to pursue talks with existing service contract holders so they can proceed with their work programs”. 

At the same time, DoE is coordinating with the Security, Justice, and Peace Cabinet Cluster to ensure the safety and security of the private firms in their offshore activities.   

PXP Energy Corp. and its subsidiary Forum (GSEC 101) Ltd. in April put on hold activities for two petroleum exploration service contracts as directed by the Energy department.   

The order was issued after reported “China’s harassment of the survey vessels hired by our service contractors,” and in consideration of “negotiations with China” at that time, according to DoE.   

PXP is the operator under Service Contract 75 while Forum holds SC 72.   

SC 75 was awarded by the DoE on Dec. 27, 2013 and covers an area of 6,160 square kilometers in the offshore northwest Palawan basin. 

Forum acquired SC 72 in April 2005. It is located in the South China Sea, west of Palawan and southwest of the Malampaya gas field.   

Mr. Pimentel said Sampaguita is estimated to contain up to 4.6 trillion cubic feet (tcf) of gas, which is comparable to the 3.4 tcf of gas reserves available in the Malampaya which supplies 20% of Luzon’s electricity demand.  

The lawmaker earlier warned that Malampaya may be depleted by 2027 and without fresh gas from Sampaguita, the Philippine’s northern mainland could face power shortages in the near future.  

Prior to the suspension of exploration activities, the Energy department gave Forum until October 16 to drill its two commitment wells at a cost of $100 million or around P5.4 billion.  

Manila’s top envoy announced on Thursday last week that oil and gas explorations between the Philippines and China have been completely terminated upon the order of President Rodrigo R. Duterte.  

“The President had spoken,” Foreign Affairs Secretary Teodoro L. Locsin, Jr. said. “I carried out his instructions to the letter: Oil and gas discussions are terminated completely.”    

“Nothing is pending; everything is over,” he added. “Three years on and we had not achieved our objective of developing oil and gas resources so critical for the Philippines — but not at the price of sovereignty; not even a particle of it.”   

Beijing, however, expressed interest in working with Manila’s incoming administration.  

“Joint offshore oil and gas development is the right way for China and the Philippines to manage maritime differences and achieve win-win results without prejudicing either side’s maritime positions and claims,” China’s Foreign Ministry Spokesperson Wang Wenbin said on Saturday.  

“China stands ready to work in concert with the new Philippine government to advance negotiations on joint development and strive to take early substantive steps so as to deliver tangible benefits to both countries and peoples,” he added. — Alyssa Nicole O. Tan 

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