DOE chief: West PH Sea dispute cost potential energy investments

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Energy Secretary Sharon Garin admits the government has offered exploration opportunities in disputed areas but no investors have taken the offer

MANILA, Philippines – Tensions between the Philippines and China over the West Philippine Sea may have caused investors to shy away from investing in the country’s energy projects, Department of Energy (DOE) Secretary Sharon Garin said on Tuesday, July 15.

During a Palace press briefing, Garin explained that investors may be wary of funding gas exploration projects in the Philippines due to uncertainties brought by the maritime dispute between Manila and Beijing.

“No investor will risk millions or billions of pesos when they are not sure it’s a secure investment,” she said in Filipino.

The country’s newest energy chief said the Philippine Coast Guard and Department of National Defense have to be well-informed of exploration activities in the disputed waters to ensure the safety of personnel.

Garin also admitted that the government has offered investment opportunities in areas such as the Reed Bank, but no investors have taken the offer so far.

“I just know we have one project, Service Contract (SC) 72, that is already there. So they are still figuring it out, it has good potential, but they still can’t decide how to start the project,” she explained in Filipino.

SC 72 was awarded to tycoon Manny Pangilinan’s PXP Energy, and covers the 8,800 square meters in Recto Bank southwest of the Malampaya Gas Field.

Despite this, Garin said several countries such as Israel, the United States and even China have expressed their interest in conducting joint oil and gas explorations.

“I think nakita nila iyong magandang investment opportunity, not just the opportunity pero iyong climate natin na it’s time for them to come in,” she said.

(I think they see a great investment opportunity, not just the opportunity but the business climate we have also made it a good time to come in.)

Malampaya drilling

The DOE earlier said that the Malampaya Phase 4 drilling program — which began in late June — is expected to be completed by the end of the year.

If the drillings yield any gas, Garin said the wells could supply up to 10 years’ worth of power.

Malampaya currently supplies around 20% of Luzon’s electricity needs. The service contract to the gas field’s drilling and exploration was awarded to a consortium led by Enrique Razon’s Prime Energy.

Its parent firm Prime Infra bought a 60% stake in First Gen Corporation’s gas assets last month. These facilities all generate power from Malamapaya.

– Rappler.com