DOE defers global petroleum roadshows to 2nd half this year

Due to the length of required preparations, the Department of Energy (DOE) has indicated that the roadshows on the country’s petroleum contracting will have to be deferred to second half, instead of having a June kick-off this year.

Energy Undersecretary Donato D. Marcos, who is the lead official in the department’s energy resource development initiatives, noted that they will formally launch the fortified Philippine Conventional Energy Contracting Program (PCECP) first in the Philippines prior to them undertaking offshore investment promotions.

“We will launch the PCECP first between mid-June this year to early July, …unfortunately, our targeted timeframes have already been overrun by events,” he said.

For instance, he noted that the original target for a roadshow in the United States should have been May this year, “but that is no longer possible – logistics and preparations wise.”

Singapore, he said, would still be the first market that they will be scouring through for investment invitations, preferably for the 14 petroleum blocks that the country will be dangling to interested takers of petroleum service contracts or PSCs.

“We will have four countries planned for the roadshow… after Singapore, we intend to have it in the US next,” the energy official stressed. Other markets on target are Australia and United Kingdom.

The Philippines has at least 16 sedimentary basins – but in this new batch of contracting, the DOE’s offer of PSCs shall only cover six basins: chiefly in Cagayan, West Luzon, East Palawan, Agusan-Davao, Cotabato and Sulu Sea.

The PCECP will have two modes of contracting: one is via tender submission on the 14 pre-determined areas or blocks; and the other is year-round submission of ‘unsolicited offers’ on service areas that the investors themselves would choose.

Via this modified contracting policy, the energy department asserted that it would be able to “address weaknesses and oversights of the previous contracting or licensing schemes.”

Prior to this round of PSC offer, the country was leaning on what was then conceptualized as the Philippine Energy Contracting Round (PECR), of which processes were typically done through competitive bidding.

Interested parties or investors will thus need to wait until such time that the DOE would schedule a bidding or tendering process before exploring prospective ventures in the sector.

Having completed at least five bidding rounds, the PECR scheme was finally shelved under the Duterte administration; and replaced by the PCECP bid submission system.

It remains to be seen though if this strategy will fare better – given all the ‘intervening factors’ that have been ruffling investors’ feathers.