DOE: Drilling moratorium still holds in disputed waters

Even with warming relations with China, oil and gas exploration projects in the disputed waters still remain on hold as far as the Department of Energy (DOE) is concerned.

The decision to lift the moratorium will be based on guidance from the Department of Foreign Affairs (DFA), Energy Secretary Alfonso Cusi said.

“That (oil and gas exploration) is still under moratorium. We are looking at DFA’s lead to give the signal that we can already lift the suspension,” he said.

The energy chief said the main issue is sovereignty over disputed waters and the DOE has no business in that area.

“Sovereignty and economic development is not sequential. The relationship issue is being taken care of by DFA and we have to coordinate with them. That’s their role and we will respect the sovereignty,” he said.

Earlier this month, businessman Manuel V. Pangilinan expressed optimism drilling works can proceed in Recto Bank, a petroleum exploration area located in the disputed West Philippine Sea, by next year amid the Philippines’ strengthening relations with China.

Pangilinan said the overall atmosphere created by President Duterte is “more conciliatory” and “more investor friendly” which will aid in the resumption of discussions over the development of oil and gas exploration projects in the disputed waters.

The DOE issued a moratorium on all exploration and drilling works in Service Contracts (SC) 72 and 75 in December 2014 and 2015, respectively, amid rising maritime tension with China.

London- listed Forum Energy plc holds a 70-percent operating interest in SC 72 or the contract to explore Recto Bank in the West Philippine Sea, where PXP Energy Corp. holds 60.45 percent.

PXP Energy, chaired by Pangilinan, also has a direct operating interest of 50 percent in SC 75 off northwest Palawan.