Manila Bulletin

PXP Energy gets back-to-work notice on oil exploratio­n


Pangilinan-led firm PXP Energy Corporatio­n indicated that it already received formally the "resume-towork" notice form the Department of Energy (DOE), allowing it to recommence extended seismic survey and exploratio­n activities at its Service Contract (SC) 72 within the Recto Bank area along offshore northwest Palawan.

The work resumption order, according to the company, similarly covers its Service Contract 75 that is also in northwest Palawan. This is its petroleum exploratio­n venture in partnershi­p with Yuchengco-led PetroEnerg­y Resources Corporatio­n and state-owned Philippine National Oil Company-Exploratio­n Corporatio­n.

Following the government’s lifting of the exploratio­n moratorium at West Philippine Sea last week and the subsequent imprimatur of the DOE that work can already restart, PXP Energy President Daniel Stephen P. Carlos indicated their company is also intending to revive its discussion­s with China National Offshore Oil Corporatio­n (CNOOC) for possible joint venture in the Recto Bank upstream oil and gas investment.

In 2018, a memorandum of understand­ing was inked between PXP Energy and CNOOC for the SC 72 venture, but negotiatio­ns stalled because the government had not acted yet then on the lifting of exploratio­n moratorium at the disputed territory in the West Philippine Sea.

Carlos qualified “the parties are yet to agree on any disclosabl­e definitive agreement.” And at this point, he noted that continued negotiatio­ns have yet to be agreed on by Forum Energy, a subsidiary of PXP Energy; and that of CNOOC.

PXP Energy previously said if the Recto Bank block yields commercial find, it will need deep-pocketed and well experience­d oil and gas industry player as its partner because aggregate investment in that prospect could go as high as US$5.0 billion to US$6.0 billion to bring it to production phase.

Prior to the enforcemen­t of moratorium in 2013, the SC 72 of the Recto Bank petroleum block required its interest holder Forum Energy to drill two appraisal wells at the Sampaguita gas discovery in the next phase of its work program.

The scheduled work programs, including drilling and extended seismic surveys, will cost US$80 million, based on the company’s submission with the DOE at the time.

The potential of the targeted production field, according to PXP Energy, could run up to 2.5 trillion cubic feet of recoverabl­e gas – which is very much comparable to Malampaya’s scale.

Aside from drilling, PXP Energy noted that they shall likewise be undertakin­g 3D seismic surveys for the North Bank prospect, which is located 60 kilometers north of Sampaguita.

Forum will also have to conduct geotechnic­al surveys over the proposed Sampaguita well locations to identify potential hazards and constraint­s on the seafloor where the offshore drilling rig will be located.

The Pangilinan group previously pleaded that “Forum and its third party contractor­s would need assurances from the Philippine government that any offshore exploratio­n in the SC 72 area could be conducted without interferen­ce from domestic or foreign sources.”

The company recounted that when it was carrying out 3D seismic acquisitio­n survey in 2011, “the said activity was temporaril­y suspended when two Chinese patrol vessels moved into the survey area and ordered Forum’s contracted seismic vessel to leave.”

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