Department of Energy opens bids for oil exploration

MANILA, Philippines — The Department of Energy (DOE) is now accepting proposals for petroleum exploration and development contracts to  fully harness the country’s indigenous resources.

DOE Secretary Alfonso Cusi has signed a a circular governing the selection process in the awarding of petroleum service contracts (PSCs) and the creation of the review and evaluation committee (REC).

“At any time of the year, anybody can offer… subject it to Swiss Challenge. Unlike in the previous practice, we have to wait for an announcement and bidding process,” he said.

“We want to facilitate, expedite the exploration work for our energy development and security,” Cusi said.

In the circular, the DOE said the selection process in the awarding of PSCs to qualified applicants shall be conducted in a transparent, open, competitive and expeditious manner.

The directive allows applicants to nominate the areas of interest in accordance with the procedures or submit offers in pre-determined areas not covered by any application or nomination.

The applications will then be subject to counter offers.

The REC, which will be headed by the Energy Resource Development Bureau, will accept, evaluate and approve or reject the applications based on the compliance to the criteria.

The circular sets the criteria for the evaluation, selection and awarding procedures for the various modes of selection process.

It also sets the criteria for selecting the highest ranking applicant, which include legal qualification, work program, technical qualification and financial qualification.

“In case of two or more applicants over the same area, the highest ranked applicant who meets the legal, technical and financial requirements shall be selected,” the DOE said.

In October, the DOE issued rules on coal operating contract (COC) under PCECP. This allows applicants to submit proposals for COCs through nomination by publication at any given time.

PCECP is a modified Philippine Energy Contracting Round (PECR) to allow private sector to submit unsolicited proposals to develop coal and petroleum contracts, which will then be subjected to a Swiss Challenge, to fast-track the development of the country’s indigenous sources, Cusi said earlier.

PECR is a transparent and competitive system for awarding service contracts which aims to showcase the petroleum and coal exploration opportunities in the country and to attract energy investors to develop the country’s indigenous oil and gas resources.

The last PECR was launched in June 2015 and showcased 11 petroleum exploration contracts.

Under PECR 5, only two exploration companies have passed the qualifying stage for three areas. These are Israel-based Ratio Oil Exploration which submitted bids and qualified for Area 4, a 416,000-hectare area in East Palawan while local company Colossal Petroleum qualified for the 576,000-hectare Area 5 in East Palawan and the 468,000-hectare Area 7 in Recto Bank.

However, these have yet to be awarded because of several tax issues in previous contracts pending in courts.

Reference:

Rivera, D. (January 24, 2018). Department of Energy opens bids for oil exploration. The Philippine Star. Retrieved from http://www.philstar.com:8080/business/2018/01/24/1780648/department-energy-opens-bids-oil-exploration

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