DOE urged to advise Filipino firms to continue West Philippine Sea exploration even without China
MANILA, Philippines — Sen. Risa Hontiveros on Friday called on the energy department to discourage service contractors from entering into joint venture agreements with China-owned companies in their oil and gas exploration in the West Philippine Sea.
“Unless China honors our victory over our Exclusive Economic Zone in the WPS, there can be no genuine joint venture,” Hontiveros said, adding that even Filipino companies allowed to explore in the area should be one with the country’s call to protect its sovereignty.
“It is undeniable that our economy will be strengthened by the resources provided by WPS. So we must protect it, take care of it, and take possession of it. Not just because we need it, but because we have the right to it,” she added in Filipino.
The senator specifically referred to Filipino company PXP Energy Corp., which she said started joint venture discussions with China National Offshore Oil Corporation, one of the largest national oil companies owned by the People’s Republic of China, after President Rodrigo Duterte lifted the moratorium on oil exploration in the disputed waters last month.
When the Department of Energy opened bids for nominated areas under its Philippine Conventional Energy Contracting Program in September, Manuel V. Pangilinan-led PXP Energy submitted a bid for nominated area 6, which is located in the resource-rich Recto Bank Basin of the West Philippine Sea.
Hontiveros pointed out that a PXP Energy survey ship was harassed by Chinese boats in the very same area in 2011. “We must not forget such incidents because China started this hostility in our own waters. What assurance can Beijing give that it will not do the same now?” she said.
Dennis Uy-led Udenna Energy Corp. submitted bids for nominated areas 7 and 8, which are also located in the Recto Bank.
For the senator, “the wealth of gas and oil in Recto Bank alone must urge the DOE to claim it unilaterally.”
Citing the energy department’s own study, Hontiveros said that Recto Bank can provide natural gas worth an estimated $19.9 billion as well as oil worth $2.1 billion. She also cited experts who said that the reserves at Recto Bank alone can supply the Philippines natural gas and oil for as long as a century.
Sen. Win Gatchalian, chair of the Senate energy committee, last month said the lifting of the moratorium was a welcome development, given “the dwindling supply from the Malampaya reservoir which accounts for 20% of power supply of the country and almost 30 percent in Luzon.”
The Malampaya deep-water gas-to-power project — the only local producer of indigenous natural gas — has been operating since 2001. Its concession contract will expire in 2024.
Is joint exploration inevitable?
A day after Energy Secretary Alfonso Cusi announced that the moratorium on oil and gas exploration would be lifted in the West Philippine Sea, the Chinese foreign minister said Beijing and Manila had come to an agreement on the subject.
“China and the Philippines have reached consensus on joint exploration of oil and gas resources in the South China Sea and set up relevant consultation and cooperation mechanisms. We hope the two sides will work together for new progress in the joint exploration,” Zhao Lijian, spokesman for the Ministry of Foreign Affairs of the People’s Republic of China, said during a regular press conference on October 16.
While the Department of Foreign Affairs has not explicitly echoed these sentiments, both the ambassadors to China and the US have indicated that an agreement regarding joint exploration is in the works.
Chito Sta. Romana, Philippine envoy to China, in an October 22 virtual briefing aired over state-run PTV said that negotiations between Beijing and Manila on exploration of the disputed area had been stalled by the pandemic. Given this, he said private companies could start their own discussions while awaiting official movement from the inter-government committee.
More recently, envoy to Washington Jose Romualdez told a California-based non-profit on Wednesday that a deal between China and the Philippines regarding joint exploration may soon be inked.
“Our foreign affairs secretary was in China about a month ago… and I think there’s already some kind of an agreement of some sort as far as that joint exploration is concerned. Hopefully, we’ll be signing an agreement fairly soon,” Romualdez said.
— with a report from The STAR
Editor’s Note: A unit under PLDT’s media conglomerate has a majority stake in Philstar Global Corp., which runs Philstar.com. This article was independently produced following editorial guidelines.