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Phinma group drops exploration of Visayan, Camotes Sea area for oil, gas

/ 05:14 AM September 05, 2019

Phinma Petroleum and Geothermal Inc. yesterday said that the Department of Energy (DOE) had approved their consortium’s request to relinquish Service Contract No. 69, which covered a prospective petroleum area in the Visayan and Camotes Sea.

PPG has requested to forego SC 69 after strong opposition from various local government units and environmental groups to the conduct of petroleum exploration activities in the area.

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In a regulatory filing, PPG said that the DOE had agreed but with the condition that SC 69 investors should first settle all remaining financial obligations related to the contract. The company said this had already been provided for in its budget for 2019.

The company formerly known as Trans-Asia Petroleum Corp., along with partner Frontier Gasfields Pty. Ltd., took over SC 69 in 2016.

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The former operator of SC 69, Otto Energy Ltd., gave up its 79-percent stake in the project “after extensive evaluation work carried out over the [exploration] block, including 2D and 3D seismic acquisition and a comprehensive farm-out process that did not deliver an acceptable commercial outcome to Otto.”

Otto said that 3D seismic data acquired in 2011 confirmed the presence of three prospects, which were called Lampos, Lampos South and Managau East.

The DOE declared a force majeure on SC 69 in 2017, suspending activities related to the contract. The LGUs involved, instead of endorsing SC 69 and issuing the necessary permits, opposed exploration  activities citing environmental and ecological concerns.

This development put yet another damper on the government’s efforts to rev up petroleum exploration activities as it strives for greater energy security particularly in light of the approaching depletion of the Malampaya gas field off Palawan.

Last month, the DOE formally acknowledged the applications of six groups for a total of seven areas across the archipelago where the companies hope to find commercially viable deposits of oil and gas.

This suggests a lukewarm response to the government’s drive to reinvigorate petroleum exploration in the country, having offered 14 “predetermined areas” for service contracting as well as allowing investors to choose their own prospective areas beyond the list.

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TAGS: Department of Energy (DOE), exploration, Petroleum, Phinma Petroleum and Geothermal Inc.
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