Gov’t to bid out drilling contract for Camago-Malampaya oilfield

The government will bid out the drilling contract for the Camago-Malampaya oil leg (CMOL), Energy Secretary Angelo T. Reyes said.

“We will bid it out,” he said, noting that the development of the oil rim has been placed in the back-burner for a couple of years now.

“The oil leg is a question that has been in the air as early as two years ago. Shell has indicated that they would rather not do it themselves. We will discuss this in the PNOC-EC board and we will discuss very seriously bidding out the oil leg portion, as soon as possible or as necessary,” he said.

Sources said bidding the contract at the soonest possible time is the best option especially since the price of crude is high.

“The government should take advantage of the high oil prices as this may mean higher bid for the contract,” an industry source said.

As this developed, the Department of Energy (DOE) will hold a public forum on the Ipil-ipil exploratory drilling project in Tanon Strait at the University of San Carlos  today.

Reyes will discuss issues surrounding the project in response to the  concerns of local government officials, fisher folks, and other stakeholders in the area.

The Ipil-Ipil exploratory drilling project started in December 2004, when the DOE and JAPEX Philippines Ltd. (a leading Japanese upstream  company) entered into Service Contract 46.

The project has subsequently undergone the process of surveying the area for the possibility of oil and gas deposits.  When the surveys yielded  positive results, drilling will soon commence.

However, since the area was declared by virtue of Presidential Proclamation 1234 as a protected seascape, an environmental compliance certification (ECC) was requested in March 2006 to ensure that the project will not be harmful to the fragile marine ecosystem. The request for the ECC was finally granted in March 2007.

To proceed with the project, a location site survey was done in July 2007 and in November 2007, the project will drill an exploratory well to determine the quality of the oil and gas deposits.

The public forum will also be attended by the DOE, Department of Environment and Natural Resources (DENR), Bureau of Fisheries and Aquatic Resources (BFAR), and Department of Tourism (DOT) officials, non-government organizations (NGOs), and members from the academe, such as Dr. Ben Malayan and Dr. Angel Alcala from Silliman University.