Local and foreign investors remained unfazed and have even continued to express keen interest in exploring for oil and gas in the Philippines despite the territorial claims and mounting protests from China.
Proof of this, according to Energy Undersecretary Jose M. Layug Jr., was the number of companies that have sought prequalification with the Department of Energy (DoE) to allow them to participate in the actual bidding for 15 highly prospective oil and gas blocks under the Philippine Energy Contracting Round 4.
As of Wednesday, 38 companies have submitted prequalification documents—a record high compared to the past bidding rounds conducted by the government. The DoE is even anticipating a few more applications before the submission deadline at 5 p.m. Wednesday, Layug said in a briefing.
“We have received an overwhelming number of parties who wanted to prequalify for PECR. We have received 36 submissions so far and that’s more than the 15 areas we’re offering. That’s a good indication that we have attracted sufficient investor interest. We’ve never had so many interested parties, notwithstanding the issue on [China’s claims for areas within the] West Philippine Sea,” Layug said.
Layug was referring to the territorial claims on Areas 3 and 4, which are both located at offshore northwest Palawan. These two areas are less than 80 nautical miles away from Palawan and are thus well within the country’s exclusive economic zone (EEZ).
However, China on Tuesday continued to reaffirm its “indisputable sovereignty over the Nansha Islands and its adjacent waters and protested against the Philippines’ plan to explore for oil and natural gas in the area of the South China Sea,” according to the website of the newspaper China Daily.
It quoted China Foreign Ministry spokesman Hong Lei as saying that the plan of the Philippine government to proceed with the PECR 4 was “unlawful.” The article further noted that China has already “protested the plans to invite foreign companies to explore in the two areas last year, saying they are part of the South China Sea region in waters where it has historic titles and sovereign rights and jurisdiction.”
Lei was reacting to earlier pronouncements made by Energy Secretary Jose Rene D. Almendras that what the Philippine government was offering under PECR 4, specifically those oil and gas blocks in the northwest Palawan area, were all within its territories.
Layug also maintained that despite China’s claims, for which he said no local or foreign investor has even shown concern, the DoE would push through the bidding of all 15 petroleum blocks in pursuit of the mandate of the President.
The energy official was also optimistic that these issues would not derail or delay the awarding of the petroleum service contracts before the end of the year, which is being highly anticipated by companies wanting to bid. These include big players like French multinational Total, Eni S.p.A. of Italy, US firm CalEnergy, GDF Suez of France, Shell Philippines Exploration BV (SPEx), NorAsian Energy Ltd., Australian firm Nido Petroleum Corp., Malaysia’s Mitra Energy Ltd., Australian firm Tap Oil Ltd., Minergy Corp. Ltd., Pitkin Petroleum Plc. and Esso, a subsidiary of exploration giant Exxon Mobil Corp.—Amy R. Remo