The Philippines: Duterte Lifts Offshore Drilling Moratorium

Enrico Dela Cruz
Friday, October 16, 2020

Philippines President Rodrigo Duterte has lifted the moratorium on petroleum exploration in the South China Sea, paving the way for three projects to resume, including a possible joint venture with China.

Energy Secretary Alfonso Cusi said on Thursday that service contractors were notified to resume energy-related activity in the area, which had been suspended from 2014 due to territorial disputes.

China claims almost the entire South China Sea, believed to be rich in energy and marine resources. Brunei, Malaysia, Vietnam and Taiwan also have claims.

Last year Duterte said Beijing had offered Manila a controlling stake in a joint energy venture in the South China Sea, if it sets aside an international arbitral award that went against China.

The Philippines had imposed the moratorium while awaiting a ruling in a case by the Permanent Court of Arbitration in the Hague, which in 2016 invalidated China's claim to sovereignty over most of the South China Sea.

Cusi said the decision to lift the moratorium was arrived at "in good faith and with full regard of the ongoing negotiations between the Philippines and China, and Forum Ltd and the China National Offshore Corp" (CNOOC).

Forum, a unit of the Philippines' PXP Energy Corp, operates Service Contract 72 covering gas exploration in the Reed Bank, which is within the disputed territory. PXP has had talks with CNOOC about joint exploration and development there.

Two other exploration projects have been given the go-signal, such as SC 59 operated by Philippine National Oil Company and SC 75, also by PXP.

"The lifting of the suspension places the service contractors under legal obligation to put capital into the contract areas and hire Filipino engineers and technical workers," Cusi said in a statement.

The Chinese embassy in Manila did not respond to Reuters' request for comment. 

(Reporting by Enrico Dela Cruz; Additional reporting by Neil Jerome Morales; Editing by Catherine Evans and Toby Chopra)

Categories: Drilling Industry News Activity Asia Regulations The Philippines

Related Stories

MidEast Energy Output Recovery to Take Two Years, IEA Says

Saipem Bags $400M in Offshore Contracts from Aramco in Saudi Arabia

Japan to Launch $10B Fund to Help Asia Secure Oil

Philippines Seeks US Extension to Buy Russian Oil

UK Declines to Support US Hormuz Blockade, PM Starmer Says

Hormuz Crisis Signals New Era of Risk for Gulf Energy

Petra Energy Secures Work Orders from Petronas for Sarawak Gas Project

Middle East Producers Gear Up for Hormuz Export Restart

Sunda, Finder Target Shared Rig for Timor-Leste Offshore Drilling

Oman’s Block 50 Offshore Drilling Ops Pushed to May

Current News

Jadestone Secures Gas Sales Deal for Fields Offshore Vietnam

Oil Flows to Lag Even if Hormuz Strait Reopens

Eni Makes Major Gas Discovery Offshore Indonesia

Strike Threat Grows at Ichthys LNG after Workers Reject Deal

Pertamina Unit to Operate Indonesia’s Lavender Block under 30-Year PSC

MidEast Energy Output Recovery to Take Two Years, IEA Says

Metropolitan CCS Cleared to Drill CO2 Storage Wells off Japan

Saipem Bags $400M in Offshore Contracts from Aramco in Saudi Arabia

Toyo, OneSubsea Form Subsea CCS Partnership

Japan to Launch $10B Fund to Help Asia Secure Oil

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com