9 firms qualify for DOE oil, gas contracts bidding

The Department of Energy Friday received a total of 16 bids for contracts to explore and develop highly prospective oil and gas blocks being auctioned off under the Philippine Energy Contracting Round 4 for petroleum.

Only 12 areas were up for bid during Friday’s exercise since the offers for Areas 3, 4 and 5—all of which are in northwest Palawan—will open on July 31, to give interested parties more time to evaluate seismic data.

Also, of the 16 bid offers, only nine had qualified for further evaluation and possible awarding later this year, said Energy Undersecretary Jose M. Layug Jr.

According to Layug, the number of offers submitted by both local and foreign oil exploration companies under the PECR were highly encouraging, as compared with the three previous contracting rounds conducted from 2003 to 2006, wherein only a total of 12 bids had been submitted.

“We are very happy with the results of the bidding. As far as the DOE is concerned, this has been the most successful [PECR], but at the end of the day, the measure of success will be if we find oil,” he said.

Among the companies whose offers had qualified for evaluation were Forum Pacific Inc., Mitra Energy Ltd., Helios Mining and Energy Corp., Dil Moro Energy, Minenergy, Loyz Oil Pte Ltd., Frontier Oil, Philodrill Corp. and Philex Petroleum. The rest of the offers, which were initially rejected in Friday’s bidding, may still be reconsidered.

It will take at least 100 days to evaluate the offers of these companies, after which the service contracts will be awarded by President Benigno Aquino III.

Layug remained hopeful that the big ticket players would make their respective bids for Areas 3, 4 and 5, which are said to promise more compared with the 12 other areas offered under PECR 4.

“We are hopeful that those who have prequalified will submits bids for the prospective blocks located in northwest Palawan basin. We are hopeful that more players will participate (on July 31 for Areas 3, 4 and 5),” he added.

Based on estimates, the expected investments for the service contracts will be $500 million each, or a total of $7.5 billion, should all the service contracts be awarded to the exploration companies.

Under PECR 4, more than 10 million hectares in Cagayan, Central Luzon, Mindoro, Cotabato, East Palawan and Sulu Sea are being offered for exploration and development.