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DOE declares Cebu oil field commercially viable

The Department of Energy (DOE) has declared that natural gas and oil resources in the Alegria Oil Field in southern Cebu are commercially viable and that supply may last for 19 years or until 2037.

The announcement was made eight years after the service contractor, China International Mining Petroleum Company Limited (CIMP Co. Ltd.), started exploration and drilling activities.

DOE Secretary Alfonso Cusi made this pronouncement on the government agency's website after signing a Joint Declaration of Commerciality (JDC) with CIMP Co. Ltd last March 14 at the Hyatt Hotel-BGC in Taguig City.

CIMP Co. Ltd. holds Petroleum Service Contract (SC) No.49, which covers the Alegria Oil Field.

Cusi and CIMP Co Ltd. Chair Lam Nam signed the declaration. DOE Undersecretary Donato D. Marcos and CIMP Co. Ltd. Chief Executive Officer Eric Lai served as witnesses.

According to DOE, the JDC outlined the roles and responsibilities of CIMP Co. Ltd. particularly its compliance with all conditions stated in the approved "Plan of Development" dated 19 December 2017.

The town of Alegria is a fourth class municipality, which is located about 115 kilometers from Cebu City.

The town is known for its natural spots and beautiful waterfalls, including the Cancalanog and Cambais waterfalls.

The village of Montpeller is the site of the oil field and incumbent town Mayor Verna Magallon was repeatedly quoted by various publications as being supportive of the project as this will benefit the small town.

According to the DOE news release, an estimated 27.93 million barrels of oil (MMBO) with a possible production recovery of 3.35 MMBO or a conservative estimate of 12 percent of total oil in place/reserves.

About 9.42 billion cubic feet (bcf) reserves of natural gas were found, with the recoverable resource estimated at 6.6 bcf or about 70 percent of total natural gas in place/reserves.

The news release revealed that "exploration and drilling activities on the oil field by the service contractor started in 2009."

"By 2016, the DOE and CIMP Co. Ltd. jointly established that the oil field contained commercial quantities of natural gas upon its discovery of oil accumulation in the adjacent hydrocarbon traps within the Alegria underground area," the DOE said. — BAP, GMA News