DoE endorses joint oil exploration with China

Image result for DoE endorses joint oil exploration with ChinaThe Energy Department endorsed for Malacañang’s approval the farm-in agreement between state-run PNOC Exploration Corp. and China National Offshore Oil Corp. over a petroleum-rich area northwest off Palawan province.

Energy Secretary Alfonso Cusi told reporters at the sidelines of the Asean Energy Business Forum 2017 that amid the strengthening ties with China, the department endorsed the agreement covering service contract 57 for the approval of President Rodrigo Duterte.

“I think we have SC 57 that is already with the Office of the President, so that we can pursue its exploration. We do that with CNOOC and together with PNOC EC,” Cusi said.

SC 57, which covers a total area of 7,200 square kilometers in the Calamian area, was awarded to

PNOC EC by the department on Sept. 15, 2005.

The area lies north of the country’s oil and gas fields such as the Malampaya, Cadlao and Matinloc and is located within the northwest Palawan block where most of the country’s oil production comes from.

“We have already finished the documentation, the contract and presented it already to the Office of the President. SC 57 is within the Philippine territory,” the energy chief said.

Cusi said SC 57 application had been pending since 2008 and was affected by the territorial dispute with China and by cases on tax interpretation of exploration firms.

CNOOC entered into SC 57 in 2006, taking a 51-percent stake but the deed of assignment to formalize its entry was not yet approved by Malacañang.

The request for approval has been pending with the Office of the President since then.  SC 57 is currently under force majeure, and exploration activities could only resume, after it was approved by the government.

Aside from CNOOC, Mitra Energy Ltd. owns a 21-percent stake in SC 57, while PNOC EC owns the remaining 28 percent.

Officials of CNOOC, the third largest national oil company in Chinam also expressed interest in the government’s planned liquefied natural gas project.

CNOOC recently met with PNOC president Reuben Lista “to discuss matters of mutual business interest related to the construction of the proposed LNG Integrated Systems Project.”

PNOC is building an LNG terminal with an initial 200-megawatt gas-fired power plant and is in discussion with prospective partners for the project. PNOC hopes to complete the terminal by 2020 or 2021.

Source: http://thestandard.com.ph/business/power-technology/247982/doe-endorses-joint-oil-exploration-with-china.html

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