DOE set to award 3 new oil exploration contracts

The Department of Energy (DOE) is set to award three new oil exploration contracts in the next 30 days, an energy official said.

"We are working on three applications for a service contract (SC). We will come up with the decision in a month’s time or in the next 30 days," Energy Undersecretary Eduardo Manalac said.

Manalac said these SCs are not part of the exploration blocks to be auctioned off under the Philippine Contracting Round (PCR-I). "These will be outside the Sulu and Palawan blocks," he said.

The DOE has offered at least 46 contract areas in Northwest, Southwest and East Palawan, Sulu Sea and Reed Bank under the PCR-I which was launched last Aug. 5.

The awarding of the contract under PCR-I will be made on April or May next year.

But Manalac said they could get some potential investors to take a look at these exploration contracts earlier than the bidding period.

He said they could tap some of the exploration companies that will be attending the Southeast Asia Energy Forum in mid-October in Singapore.

"There will be some Singaporean companies that might be interested to bid for PCR-I," he said.

The energy official is optimistic that they could attract more investors into the PCR-I. "We have a process now that investors can look at. We should recognize the high risk they would be getting in investing into petroleum exploration," he said.

Manalac said exploration firms can still come in to the country for other drilling sites. "People can still come in other drilling areas in the Philippine but the process will not be as systematic as this (PCR-I)," he said.

It was estimated that for the upstream natural gas sector development alone, the country will need a total of $55 billion in new investments in the next 10 years.

About $7 billion will also be needed in the next 10 years for the downstream sector of the natural gas industry.

Some $4 billion will be required to build greenfield or new power plants and convert some of the thermal facilities into gas-fired power plants.