DOE sets opening of bids for 17 petroleum blocks

Published August 14, 2019, 12:00 AM

by manilabulletin_admin

By Myrna M. Velasco

The Department of Energy (DOE) has formally announced that it will start opening bids this Friday for petroleum blocks within three (3) nominated and the 14 pre-determined areas (PDAs) being tendered under the Philippine Conventional Energy Contracting Program (PCECP) designed by the Duterte administration.

Energy Secretary Alfonso G. Cusi (Source: https://www.bloomberg.com)
Energy Secretary Alfonso G. Cusi (Source: https://www.bloomberg.com)

For the three service areas in Northwest Palawan, Sulu Sea and Ragay Gulf that had been placed under 60-day challenge, the DOE indicated “each of the three nominating companies had complied with area clearance and nomination requirements.”

On the bid opening that will kick-off this August 16, the DOE’s Centralized Review and Evaluation Committee (C-REC) will be the leading entity to manage it, “to run the completeness check for each submitted proposal.”

According to the department, “the lack of any documentary requisite in the PCECP Guidelines and application checklist – which includes legal, technical and financial qualification documents – will warrant an automatic disqualification.”

Conversely, the qualified applications “shall be subjected to further exhaustive evaluations from the C-REC, before the endorsement of the highest ranked application to the secretary.”

Following that, the declared winning bid will have its service contract endorsed for signing by the President of the Philippines.

In this forthcoming petroleum contracting round, Energy Secretary Alfonso G. Cusi is expecting a “successful outcome” despite lingering policy and diplomatic hurdles especially for blocks straddling conflict areas within the West Philippine Sea.

“I’m quite optimistic based on the response that we received. I am optimistic that there will be some good things to happen,” he said.

The bid submission deadline and opening for the pre-determined areas will be on August 19 (Monday); while the offers for the challenged areas will be opened on August 16 for Sulu Sea, August 19 for Northwest Palawan; and August 20 for Ragay Gulf.

Cusi noted though that interests or nominations within the so-called “conflict areas” within the West Philippine Sea may take longer to sort out given the diplomatic tussle still being resolved by the governments of China and the Philippines.

“We have to come up with an agreement,” Cusi said; noting that at this stage, the parties had just agreed to have their State nominees for the forward discussions.

On the part of the Philippines, the energy chief emphasized that the nominee in the discussions toward the crafting of a “joint oil and gas exploration framework” will be the state-run Philippine National Oil Company.

As of latest count, the DOE is leaning on the interests of more than 20 companies prospectively advancing into bids submission on August 19 for the pre-determined blocks; and the rest are eyeing to explore at their nominated blocks once cleared by the department.

The PDAs comprise of 14 service areas along six basins in various parts of the country. Altogether, they straddle 73,576.66 square kilometers of both shallow and deep-water drilling prospects in East Palawan, Cagayan, West Luzon, Sulu Sea, Cotabato and Agusan-Davao basins.

For investors having preference to nominate their selected blocks, this could be done year-round but subject to a challenge period with corresponding fees.

Nevertheless, for areas that are still strained by the declared moratorium on exploration and drilling at the West Philippine Sea, the energy department indicated that it will not process such applications until the time that there is already a definitive joint exploration deal reached with China.

 
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