DoE extends schedule in Palawan exploration


The Energy Department extended the exploration program of Nido Petroleum Corp. of Australia and PNOC Exploration Corp. northwest off Palawan in South China Sea amid the territorial dispute between the Philippines and China.

The two companies said they obtained extension of the work program under service contract 58 from the Energy Department while works in the area were suspended. The Energy Department confirmed the suspension of the projects in SC 58 amid the territorial dispute.

“The arbitration case [filed by Philippines against China] resulted to refrain in our exploration activities in the West Philippine Sea. However, I believe that after the decision, our policy will have to ensure enforcement of our rights to protect and utilize the resources within our EEZ (exclusive economic zone). SC 58 will definitely develop its area with the full support of the Philippine government,” Rino Abad, director of the department’s Energy Resource Development Bureau said.

Nido said in its quarterly report the company “obtained a further extension of the election to drill required under the company’s farm out agreement with PNOC Exploration, the oil and gas arm of state-owned Philippine National Oil Co.”

Nido earlier requested the Energy Department for suspension of the performance of work commitments and obligations on the SC 58 block as early as 2013.

Nido said it was in the last quarter of 2014 that it obtained approval from the department to place the service contract “into a period of suspension pending outcome of arbitration proceedings between the Philippines and the Peoples Republic of China over the ownership of the West Philippine Sea where SC 58 is located.”

Aside from SC 58 located in the Palawan basin, the department also put SC 72 in northwest Palawan covering the Recto Bank on force majeure due to the territorial dispute.

The Energy and the Foreign Affairs Department earlier granted the SC 58 joint venture further extension of the sub-phase 3, from Jan. 12, 2009 to July 19, 2015.

Nido said it obtained the extension in the wake of the ongoing suspension of it work program.

The department awarded SC 58  to PNOC Exploration on January 12, 2006.

It is a deep water acreage covering an area of 13,440 sq km west of SC 57 and SC 38 offshore northwest Palawan. It is flanked to the west by the Malampaya gas field and other oil and gas discoveries.

Read More:

Leave a Reply

Your email address will not be published. Required fields are marked *