PNOC-EC seeks new partners for Mindoro exploration areas

MANILA, Philippines - State-run PNOC Exploration Corp. is scouting for new partners for its Mindoro exploration areas.

PNOC-EC vice president Leocadio Ostrea said they have been holding talks with at least four interested foreign groups for a possible farm-in agreement. PNOC-EC is farming out shares in its service contract in offshore Mindoro and East Sabina.

“We are in talks with three to four foreign firms for the offshore Mindoro block under Service Contract 47,” he said.

The company bagged SC 47, which covers an area of 14,667 square kilometers in offshore Mindoro, in July 2005. It started to operate the exploration block in early 2008 after Malaysia’s Petronas of Malaysia relinquished its interest in the block due to unfavorable results of the Kamia 1 well drilled in 2007.

PNOC-EC currently owns a 97 percent interest in the block while partners PetroEnergy Resources Corp. and Basic Energy Corp. holds two percent and one percent participating interests, respectively.

According to the PNOC-EC official, they are still finalizing how much they are willing to farm out to these foreign exploration firms.

Meanwhile, Ostrea said the company is also discussing possible farm in agreements with several foreign investors for SC 63 or the East Sabina block.

SC 63 covers an area of 10,560 square kilometers located in offshore southwest Palawan.

PNOC-EC’s shares of stock are 99.78 percent owned by the Philippine government through state-owned Philippine National Oil Co. (PNOC), its mother firm, with the remaining 0.22 percent held by public shareholders.

In its early years, PNOC-EC served mainly as a catalyst in petroleum exploration, focusing its activities in frontier onshore areas in Cagayan Valley, Central Luzon and Samar.

In 1994, PNOC-EC’s three-megawatt San Antonio gas power plant in Echague, Isabela was commissioned, providing electricity to more than 10,000 households. The operation of the facility made PNOC-EC the country’s first producer of indigenous natural gas.

Encouraged by its successes, PNOC-EC started to take bold moves in the 1990s by expanding its operations in the offshore areas of Northern Palawan, Ragay Gulf and offshore Mindoro.

During this period, the company became either a lead operator or a partner in petroleum exploration joint ventures with local and foreign companies.

It currently owns a 10 percent stake in the Malampaya gas field under SC 38, which fuels three natural gas power plants with a capacity of 2,700 MW. It also holds stakes in SC 59 (West Balabac), SC 43 (Ragay Gulf), SC 57 (Calamian) and SC 58 (West Calamian).