DOE allows Philodrill to exit Palawan exploration contract | Inquirer Business
Giving up Octon Block service contract

DOE allows Philodrill to exit Palawan exploration contract

/ 02:02 AM September 07, 2022
DOE allows Philodrill to exit Palawan exploration contract

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The Department of Energy (DOE) approved the request of exploration company The Philodrill Corp. to relinquish its license to explore oil and gas resources in offshore northwest Palawan.

In a regulatory filing, Philodrill informed the local bourse that its appeal to surrender service contract (SC) No. 6A or the Octon Block had been granted by the DOE.

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“After evaluation, we verified that the SC 6A Joint Venture partners have complied with Philodrill’s technical and financial obligations with the DOE. In view of said compliance, we hereby approve the request of Philodrill for relinquishment,” Philodrill told the stock exchange, quoting the DOE letter to them.

“Philodrill and the rest of the continuing partners intend to nominate the surrendered area for a new SC application under the PCECP (Philippine Conventional Energy Contracting Program),” it added.

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Philodrill was the operator of SC 6A, with Anglo Philippine Holdings Corp., Forum Energy Philippines Corp., PXP Energy Corp. and Alcorn Petroleum and Minerals Corp. as joint venture partners. The contract will expire in February 2024.

The listed firm had said exploration efforts in the area continued through most of the first quarter of this year although it already submitted on March 31, 2021 a notice to surrender to the DOE.

Otherwise, a work program and budget to conclude the last outstanding piece of technical work to site a drilling location would have been submitted to the DOE.

However, when ACE Enexor Inc., the oil and gas exploration and production business of the Ayala Group, bowed out of SC 6A last year, the remaining entities opted to give up the contract and apply for a new one under the PCECP, a scheme adopted by the DOE in awarding coal and petroleum service contracts.

This route is seen to enable the joint venture partners “to reconstitute and have sufficient time to drill and develop any future discoveries in the area,” said Philodrill in its 2021 annual report. INQ

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