65 foreign investors eyeing PH petroleum contracting

Published November 22, 2018, 12:00 AM

by manilabulletin_admin

By Myrna M. Velasco

In a show of force at the launch of the Philippine Conventional Energy Contracting Program (PCECP), 65 foreign investors and more than 200 local companies have manifested interest to bid in the petroleum blocks being offered by the government, according to the Department of Energy.

Energy Secretary Alfonso Cusi
Energy Secretary Alfonso Cusi

The interested parties may either submit proposals for the 14 pre-determined areas (PDAs) or submit tender on their preferred blocks at their own pace or timelines.

Energy Secretary Alfonso G. Cusi said the country needs to step up efforts in enticing investors into the exploration and development of indigenous oil and gas resources because it has already been way behind neighbors. At the same time, this will weigh on the nation’s energy security agenda.

“We have been grossly trailing behind our neighbors in terms of petroleum exploration and development activities,” he stressed.

The roll of interested foreign and local companies include: Energy World Corporation, Manta Oil Company, Philipps, MCC Consortium Philippines, Sulu Sea Energy Resources Development Corporation, Ulangig Mindanao Inc., Joppa Corporation, Platinum Group Metals, Western Sulu Gulf Oil, Sulubasin Oil and Gas Corp., GE Global, Altura Mining, Minsupala Energy and Minerals Resources, Esmaulana Global Ventures Company, Hansung Global Korea, PIONAIRE Finance Ltd., Esrael Group of Investors, Seaoil Philippines, Tawi-Tawian Petroleum Trading, Island Petroleum Corporation, Philindo Tech Naga Corp., Eastern Petroleum Corporation, Troika Giant Power Corp., Mindanao-Asia International Energy Limited, Pacific Coast, Ostrea Mineral Laboratories, San Lorenzo Ruiz Builders and Developers, Global Oil and Gas Resources, EP Oilfields Services, Glove Inc., MASE Holdings, JST Korea, Sundagas, Desert Rose Petroleum, China International Mining Petroleum, Shell Philippines B.V., Repsol Oil and Gas, Nido Petroleum, CGG, Chevron, Searcher Seismic, Valero Texas City Refinery, Philodrill Corporation, Phinma Petroleum, Newrest SOS , PXP Energy and PetroEnergy Resources Corporation.

Of the 14 blocks being dangled to investors, Cusi emphasized that not a single one straddles the so-called “conflict areas” within the West Philippine Sea, hence, uncertainty of diplomatic strife shall not be a concern.

The Department of Energy (DOE) previously penciled in gigantic investments of up to $2.376 billion just on the 14 blocks that had been set for tender. These comprise of four (4) areas in West Luzon basin; three (3) areas in East Palawan; three (3) blocks in Sulu Sea; two (2) areas in Cotabato; and one each in Cagayan and Agusan-Davao basins.

Energy Undersecretary Donato Marcos similarly indicated that they already received “unsolicited tenders” on at last six (6) service areas being dangled via a nomination process.

The submissions have been from 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 eyeing at least four (4) service areas; and the two other areas covered the offer of Constellation Energy Corporation.

Marcos noted that even areas within the territorial claim-saddled West Philippine Sea have been drawing some interests – from both local and foreign investors. The initial targets of which are proximate to the Reed Bank in northwest Palawan basin.

For the six nominated areas alone that are of ‘unsolicited bids’ stature, total investments are anticipated to reach 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.

For the government-predetermined blocks, targeted investments had been set higher because the areas are combination of eight (8) shallow and six (6) deep water seismic survey and exploration activities.

The drilling cost per well in shallow waters amounts to US$15 million; while those in deep waters will require capital outlay of US100 million per well.

Given the minimum requirement of at least three wells that must be drilled under the sub-phase work program of service contracts, expenses could reach US$45 million per petroleum block for those in shallow waters; and US$300 million per service area for those in deep waters.