PXP Energy to seek lifting of exploration moratorium

Date Published (mm/dd/yyyy): 
12/04/2018

PXP Energy Corporation will be seeking the imprimatur of its board of directors so it can formally send correspondence to relevant government agencies on its bid for the lifting of oil exploration moratorium at the block covered by its Service Contract 72.

The company was tied into a force majeure condition when the government enforced drilling moratorium at the Recto Bank following the Philippines’ diplomatic tussle with China roughly four years ago.

On the moratorium lifting, PXP Energy President Daniel P. Carlos said “we will discuss that with our Board… we will request to lift the force majeure which was enforced by government.”

Energy Secretary Alfonso G. Cusi personally told Carlos that PXP Energy can already send formal correspondence to the DOE on the moratorium lifting “and the government will just act on it accordingly.”

The Department of Foreign Affairs (DFA) previously indicated that the energy department can already take upon itself to decide on matters relating to the concerns of investors on petroleum exploration – including the need to free up the earlier mandated prohibition of exploration and drilling at the deemed ‘conflict areas’ within the West Philippine Sea.

Carlos said the scheduled drilling of two wells will command an investment of US$60 million. In essence, per well will cost US$30 million.

He qualified that the company – with its new partners Dennison Holdings of businessman Dennis Uy and China National Offshore Oil Corporation (CNOOC) – will have 20 months to complete the next phase of the SC 72 work program from the lifting of the exploration moratorium.

The depth of the drilling, Carlos said, will be up to 4,000 meters as earlier assessed. Beyond the scheduled drilling, the company is also planning to carry out extended seismic survey in an area proximate to its block.

On the partnership with CNOOC, PXP noted that the next step will be formation of committees to flesh out their work plan and other terms of partnership.

Carlos indicated there had been no further discussion yet with CNOOC on this sphere, but they are expecting that work planning will advance in the coming months.

Reference:

Velasco, M. M. (December 4, 2018). PXP Energy to seek lifting of exploration moratorium. Manila Bulletin. Retrieved from https://business.mb.com.ph/2018/12/04/pxp-energy-to-seek-lifting-of-exploration-moratorium/

 

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