Philex eyeing petroleum exploration contracts

Philex Mining Corp., through its oil exploration subsidiary, Philex Petroleum Corp., is considering applying for service contracts to explore and develop potential petroleum areas, which are now being offered to investors by the government.

“We’re looking at that as well. It’s something the country needs—(for companies) to explore. We don’t know yet which ones we would vie for in case we participate,” said Philex Mining chairman Manuel V. Pangilinan.

Pangilinan expressed optimism in joining the ongoing Philippine Energy Contracting Round (PECR) 4, where contracts for 15 petroleum blocks will be offered by the Department of Energy (DoE), even as Philex Mining’s own exploration activities within Recto Bank (formerly Reed Bank) were being affected by “political” issues.

Philex Mining, through its subsidiaries FEC Resources Inc. and Philex Petroleum, holds 64.45 percent of the issued capital of Forum Energy Plc.

The UK-based Forum Energy holds 70 percent of Service Contract 72, while the remaining 30 percent is held by Monte Oro Resources and Energy Inc.

“We have a commitment to the government given our work program. We are worried of the (consequences) if the program gets held back for political reasons. For example, how can we drill appraisal wells if there are Chinese boats in the horizon,” Pangilinan said.

Pangilinan admitted that the activities being conducted by its survey ship was earlier stalled due to “harassment.” The government, however, helped the joint venture complete the seismic activities in SC 72.

It was earlier reported that an exploration boat in the area was approached by two Chinese patrol boats in March. Although the Philippine government had filed a protest with the Chinese Embassy in Manila, demanding an explanation from Beijing over the incident at the Reed Bank, China was reported to have just brushed aside the complaints.

Still, the SC 72 joint venture is spending $86 million, or about P3.7 billion, for its exploration activities within the Reed Bank between now and mid-2013. The amount will be used to drill an appraisal and exploration wells within the next two years.