PH asserts ‘exclusive licensing’ for petroleum exploration at WPS

Published April 21, 2021, 4:11 PM

by Myrna M. Velasco

The Philippine government said it will invoke ‘exclusive licensing’ authority for any and all petroleum exploration ventures that will be carried out within the disputed territories of the West Philippine Sea.

This was set on record by Energy Secretary Alfonso G. Cusi, in line with the Department of Energy’s role as the agency in charge of issuing service contracts (SCs) for oil and gas exploration investments in the country.

Energy Secretary Alfonso G. Cusi

The energy chief said he is supporting the statement of President Rodrigo Duterte that when it comes to extraction of petroleum resources within the WPS, the country will have to assert its sovereign rights over its exclusive economic zone (EEZ) and other claims in that diplomatically-strained domain.

“The DOE stands firmly behind any decision and action of President Rodrigo Duterte regarding the assertion of the exclusive licensing authority of the Philippines over petroleum and other resources in the seabed and subsoil of the West Philippine Sea,” Cusi said.

The energy chief noted that invoking such right is in accordance with the prescriptions of the Philippine Constitution and the country’s petroleum laws, including Presidential Decree 87 or the Philippine Oil and Gas Law.

“Under our laws, only the Philippine government through the DOE, may issue licenses to drill in Philippine land territory, including its islands, internal waters, territorial sea, EEZ and continental shelf,” he expounded.

Cusi qualified that “should any foreign state engage in petroleum activities inside the Philippine petroleum jurisdiction, the DOE shall take the necessary steps to protect our licenses and preserve our resources.”

Nevertheless, he stated that when it comes to defense-related concerns in the disputed areas, that shall rest on the sole prerogative of the President, which could be anchored on any recommendation of the Department of Foreign Affairs.

The Philippine government lifted the moratorium on oil and gas exploration ventures at the West Philippine Sea around October last year, yet despite that bold move of the State, there’s not much whetted appetite manifesting yet when it comes to capital flow for upstream oil and gas investments in the country.

For existing players that have deferred seismic and targeted petroleum drilling activities in the disputed waters, like that of PXP Energy Corporation of businessman Manuel V. Pangilinan, they indicated that they will continually seek guidance from the government on how they will proceed with their work program especially if they are bringing in a Chinese partner.

Among the concerns raised by upstream petroleum players is on probabilities that once they will advance on seismic or exploration activities at the West Philippine Sea, there could be instances that their deployment of people and vessels could be hobbled by the presence of Chinese ships in the area.

The commercial development of the country’s oil and gas resources is considerably lagging compared to neighbors in the Southeast Asian region; and that shoddy performance in largely blamed on the unending tension over the WPS territory.