MANILA, Philippines—To boost the country’s energy security, the Department of Energy is set mount road show in Asia, the United States and Europe within the third quarter, offering prospective investors 18 potential oil and gas areas for exploration and development.
“It looks very exciting,” Energy Secretary Jose Rene D. Almendras told reporters Monday night on the sidelines of an oil company marketing event. “Even in the international scene, there’s so much interest in the Philippines’ oil exploration… all the large exploration companies, some of which have yet to come here, are now coming.”
Almendras did not disclose the interested parties but noted that some of them were the “usual suspects” including BHP Billiton and Exxon.
According to Almendras, the road show will kick off in July, after the government has announced the areas to be offered under the Philippine Exploration Contracting Round (PECR) for 2011.
Energy officials are eyeing to begin the PECR offering by the end of June, in a bid to speed up the development of the country’s indigenous resources and help shore up power supply over the next several years, in light of an impending power crisis that continues to threaten the Philippine economy.
“I’m off to Texas and London for a road show by July or August. In the spirit of transparency, we don’t want to be accused of being restrictive in the way we share the information. We will do the road show to answer investors’ concerns. Singapore and Australia will also be included in the road show,” Almendras said.
“We will launch to inform potential investors of the sites to be bid out and at the same time address their concerns. We’re finalizing the schedule. By the end of the third quarter or early fourth, we should be able to award service contracts,” Almendras added.
Almendras expressed optimism that contracts will be awarded within the year, despite the outstanding taxation issues raised by the Commission on Audit last year regarding service contract in the $4.5-billion Malampaya natural gas power project off Palawan. He was confident these issues would be resolved soon in favor of boosting the country’s energy security.
Almendras said the Philippine government would be offering 15 new prospective oil and gas areas involving a total of 7.92 million hectares in Cagayan, Central Luzon, Northwest Palawan, Mindoro-Cuyo basin, East Palawan and Cotabato. A number of these areas have already been pre-tested, while some have undergone seismic evaluations.
He added that three canceled petroleum exploration contracts would also be offered to investors. The canceling of contracts was an offshoot of the stringent reviews conducted by the Department of Energy last year to ensure that all contracts awarded were above board and that the contract holders were fulfilling their commitments.
Almendras has since warned all contract holders to fulfill their commitments or face contract cancellations.
“The bidders need to prove their competency. We would like to reiterate that PECR is not just about money, but also competency and quality work program. Our job is to accelerate the development. A bidder may give a very high proposal but it would take 20 years to develop. I’d rather give it to somebody who can do it for three years, as we need the energy as soon as possible,” Almendras said.