China partnership not required for contractors to resume WPS oil exploration —Cusi

Energy Secretary Alfonso Cusi on Wednesday reiterated that the government’s move to lift the temporary suspension of oil exploration activities in the West Philippine Sea (WPS) is a unilateral decision, noting that companies doing petroleum-related activities can resume works with or without tapping a Chinese partner.

“If they [service contractors] want to negotiate with CNOOC (China National Offshore Oil Corporation), they can do that [but] that is not a precondition for them to resume the works,” Cusi told reporters in a virtual briefing.

In October, the Department of Energy (DOE) announced that President Rodrigo Duterte approved its recommendation to lift the moratorium of petroleum activities in the disputed waters.

Cusi, later on, insisted that such a decision is unilateral on the part of the Philippine government while committing that the move will not affect the ongoing talks between Manila and Beijing on the joint cooperation on oil and gas development.

The Energy chief was referring to the memorandum of understanding (MOU) inked by the Philippines and China in November 2018, in which both governments agreed to establish an intergovernmental joint steering committee to look into possible energy cooperation.

Under the MOU, each working group that will look into a possible exploration deal between the Philippines and China "will consist of representatives from enterprises authorized by the two governments."

The authorized enterprises include the China National Offshore Oil Corporation (CNOOC) and the Philippine National Oil Company-Exploration Corporation.

Cusi emphasized that service contractors can explore commercial operations with CNOOC “if they cannot do it by themselves and they need a partner.”

“If they can do it by themselves, they can do it,” he said, noting that “ang lifting ng moratorium is unilateral.”

“Binigyan na namin sila ng instruction to resume work... Based on the lifting of the moratorium, they should resume. They should start working, we gave them the notice to proceed based on the work plan they submitted,” the Energy chief said.

China has said it hopes it can work together with the Philippines in jointly developing energy projects in the disputed waters.

The Energy department has already issued a “Resume-to-Work” to the Service Contractors (SC) doing petroleum-related activities in the areas of SC 59, 72, and 75 in the West Philippine Sea.

The activities there were suspended on the ground of “Force Majeure” due to the WPS dispute.

The SC 59 in West Balabac, southwest of Palawan is operated by state-run Philippine National Oil Company-Exploration Corp. (PNOC-EC).

The SC 72 in the Reed Bank, meanwhile, is held by London-listed Forum Energy Ltd.

Pangilinan-led PXP Energy Corp. holds the SC 75 in northwest Palawan.

In a separate briefing, businessman Manuel V. Pangilinan said that Forum Energy and PXP are already preparing to submit its “rehashed” work program from SC 72 and 75.

“We have to rehash our work program to adapt to current conditions,” Pangilinan said.

In 2015, the DOE suspended all drilling and exploration works in the West Philippine Sea, particularly in the area covered by Service Contract (SC) 72 in the Reed Bank, citing a force majeure as the site is the subject of a territorial dispute between the Philippines and China.

China aggressively claims almost the entire South China, parts of which overlaps with the Philippines’ exclusive economic zone.

Duterte temporarily set aside the 2016 ruling of The Hague-based Permanent Court of Arbitration that invalidated China’s excessive claims in the South China Sea in order to forge stronger trade and economic ties with China even as he promised to raise the decision at a proper time during his term which ends in June 2022.

In September this year, however, the President invoked the country’s arbitral victory in 2016 against China's massive claims in the South China Sea in his first speech before the United Nations General Assembly.

The Energy chief said the Philippines will “stand up” for its rights, in the event that China protests the resumption of petroleum activities in the disputed territory.

Nevertheless, he said that a joint exploration does not compromise the Philippines’ sovereign rights in the West Philippine Sea as highlighted by the arbitral award.

The DOE earlier said there could be millions of barrels of oil and natural gas reserves in the West Philippine Sea.—AOL, GMA News