MANILA -- The Department of Energy (DOE) will be accepting the applications of parties interested in exploring for untapped energy resources in the country, within the next six months.
The DOE formally launched the Philippine Conventional Energy Contracting Program (PCECP) in Taguig City on Thursday with the objective of promoting exploration activities in pre-determined and nominated areas, where there are potential energy resources.
DOE Secretary Alfonso Cusi said in his speech that the Philippines only had five drilling activities per year within a decade, which is lower than annual drilling of Vietnam at 24, Myanmar at 29, Thailand at 594, and Indonesia at 900 wells per year.
“The DOE has drawn up an enhanced system of awarding petroleum service contract. The Philippine Conventional Energy Contracting Program or PCECP was designed with the primary role of encouraging stakeholders to invest, explore, develop, and produce Philippine indigenous energy resources,” Cusi said.
He also cited four key measures that should be put in place to strengthen the upstream industry of oil and gas, which include technically competent monitoring body, effective implementation of streamlined policies, sound political climate, and ability of the government to preserve contracts including security of investments.
Interested investors can select from 14 onshore and offshore areas predetermined by the DOE.
Area 1 is in Cagayan Basin; Area 2, 3, and 4 are in East Palawan Basin; Area 5, 6, and 7 are in Sulu Sea; Area 8 and 9 are in Agusan-Davao Basin; Area 10 is in Cotabato Basi; and Area 11, 12, 13, and 14 are in West Luzon.
The pre-determined areas up for exploration measure 7.28 million hectares.
Energy Resource Development Bureau Director Melita Obillo said the East Palawan Basin, consisting Area 2, 3, and 4, host existing drilling activities that have proven the existence of a petroleum system in the area.
The West Luzon Basin, on the other hand, has large economic potential as the location is near Clark and Subic which host key economic zones, Obillo added.
Aside from the 14 pre-determined areas, interested parties may nominate areas within Exclusive Economic Zone (EEZ) for exploration at their own expense. However, the application to explore a nominated area shall have DOE’s approval.
DOE Assistant Secretary Leonido Pulido III mentioned that the department may name the winning applications within the next 200 days.
Pulido said the contract duration is seven years and extendable to another three years for the exploration phase. The production phase has 25-year contract that can be extended to another 15 years. But “no service contract can go beyond a stipulated 50-year period”, according to the DOE official. (PNA)
