Monday, July 20, 2015


The Armed Forces of the Philippines (AFP) announced that it is more than ready to secure the Australian-Filipino consortium which is planning to drill a new exploratory well in the West Philippine Sea (WPS).
Philippine Navy: We are Ready To Face The Chinese Navy -
Possible Confrontation Between China and Philippine Navy if they Harass Oil Drilling - By: Jason E.
President Harry S. Truman’s Proclamation 2667 declared the Spratlys integral part of the Philippine Territory on 28 Sept. 1945 - Lemuria

That area (is within) our exclusive economic zone so any exploration must be protected by our navy. It’s incumbent upon us to protect the activity,” Lt. Col. Noel Detoyato, AFP public affairs office chief, said.

The consortium will commence drilling on August 1.

Detoyato said the AFP will deploy the Navy to secure the project but did not give further details for security reasons.

“As long as it is within Philippines waters, our Navy will secure those who are involved in economic activities,” he added.

And when asked whether the AFP is expecting the Chinese to harass the consortium, Detoyato said:”We don’t expect any but we are prepared.”

Reports indicate that the oil exploration project will be conducted off the coast of Zambales, but in an area that is not part of the disputed area of the West Philippine Sea.

As this develops, the AFP public affairs chief welcomed the maritime surveillance flight conducted by a P-8A Poseidon aircraft of the US Navy with Pacific Fleet Commander Admiral Scott Swift on board.

“I’m sure it will help us more . . . it will give us more on information because there will be info sharing on whatever they will observe, all activities in the area,” Detoyato said.

“They are sending a good message that they are also concerned about the security situation in the area. Depending on the point of view where you’re coming from, from our point of view it is a good gesture because somebody is concerned with our concerns,” he stressed. (PNA)

Updated July 20, 2015

Otto Energy employed Maersk Drilling to secure the Maersk Venturer, right, ultra-deep water drillship for the Hawkeye-1 exploration well off Palawan island in the Philippines. Maersk Drilling/File

MANILA, Philippines — The military is ready to secure the Australian-Filipino consortium that will drill for oil in the resource-rich West Philippine Sea (South China Sea), the subject of a longstanding maritime row in the region.

Armed Forces public affairs chief Lt. Col. Noel Detoyato said the military does not expect China to harass the exploration teams but Navy forces are ready for any eventuality.

"That area borders on our exclusive economic zone so any exploration must be protected by our Navy. It's incumbent upon us to protect (the activity)," Detoyato said in a press briefing.

"Our Philippine Navy will secure those who are involved in economic activities," he added.

When asked if they expect Chinese ships to harass the drilling team, Detoyato replied: "None that I know of."

"We don't expect any but we are prepared," he added.

Detoyato said the Navy has equipment to ward off any attempt to harass the exploration team but declined to elaborate.

On Sunday, Liquefied Petroleum Gas Marketers' Association party-list Rep. Arnel Ty said an Australian-Filipino consortium would drill a new deepwater exploratory well in the West Philippine Sea.

Aussie-Philippines group to drill for oil in disputed waters

He said the group that bagged the petroleum service contract (SC) 55 would drill the Hawkeye exploratory well on Aug. 1, a day after the super deepwater drill ship Maersk Venturer arrives on site.

The site is not located in the West Philippine Sea area being claimed by China. However, there have been reports of China's presence in areas that are not being disputed by claimants.

In 2011, two Chinese ships reportedly bullied a civilian vessel commissioned by the Energy department while conducting an oil exploration in the Recto Bank.

Philippine officials previously said that Recto Bank is not part of disputed territory and is well within the country's exclusive economic zone.

Located 80 nautical miles from Palawan, Recto Bank has an estimated resource potential of 165 million barrels of oil and 3,486 billion cubic feet of gas

The SC 55 consortium consists of Australia's Otto Energy Investments Ltd., which has 78.18 percent interest, Red Emperor Resources NL, which has 15 percent and Palawan 55 Exploration and Production Corp. with 6.82 percent.

The group is investing $24.5-million or P1.1 billion to drill the Hawkeye well.

July 19, 2015 10:14 AM

Malampaya gas field, TV5 SCREEGRAB means BUSINESS 

MANILA - An Australian-Filipino consortium is set drill a new deepwater exploratory well in the West Philippine Sea, hoping to unlock a commercially viable oil reservoir, the Liquefied Petroleum Gas Marketers’ Association (LPG-MA) said in a news release Sunday.

The private consortium that runs petroleum Service Contract (SC) 55 will spud the Hawkeye exploratory well on August 1, immediately after the July 31 arrival of the super deepwater drillship Maersk Venturer on site, according to House Deputy Minority Leader and LPG-MA Rep. Arnel Ty.

“We applaud the consortium’s resolve to push through with the drilling of the well, at a time when many oil and gas explorers around the world have abandoned their search for new hydrocarbon deposits amid the 50-percent plunge in oil prices,” said Ty, who speaks for the minority bloc in the House energy committee.

“This new drilling underscores the strategic economic value of the West Philippine Sea, which is the source of most of the country’s productive offshore oil and gas fields, and is believed to hoard stacks of hydrocarbon that, once harnessed, could enable the Philippines to become self-sufficient in its future energy needs,” Ty added.

“Fortunately, SC 55 is not situated in contested territory in the West Philippine Sea,” Ty said.

In March, Department of Energy (DOE) granted a force majeure on a separate petroleum exploration concession in the West Philippine Sea -- SC 72 -- because it falls within the disputed area that is now the subject of a United Nations arbitration process between the Philippines and China.

Forum Energy Plc, the operator of SC 72, had no choice but suspend all exploration work over its contract area “until further notice from the DOE.”

SC 72 covers the gas-rich Recto (Reed) Bank, a disputed area that is farther northwest off Palawan compared to SC 55.

Best estimate: 112 million barrels of oil

Meanwhile, the SC 55 consortium is spending a fully funded $24.5 million (P1.1 billion) to drill the Hawkeye well.

The group is composed of Australia’s Otto Energy Investments Ltd. (operator, with 78.18 percent interest), Red Emperor Resources NL (15 percent), and Palawan 55 Exploration and Production Corp. (6.82 percent).

Palawan 55 is a wholly owned subsidiary of Trans-Asia Petroleum Corp., a Philippine Stock Exchange-listed entity controlled by businessman Ramon R. del Rosario Jr.

Philippine stock market speculators have pushed up Trans-Asia Petroleum’s share price by more than 200 percent year to date, ahead of the scheduled drilling.

In a statement issued when Otto contracted the 60,000-ton Maersk Venturer, Otto chief executive officer Matthew Allen said: “Final preparations for the drilling of the Hawkeye-1 exploration well are considerably advanced. This is a very exciting time for Otto as we undertake this important and potentially high impact, drilling event on behalf of the Philippines DOE and our joint venture partners.”

Based on extensive studies, Otto said Hawkeye could possibly contain a “best estimate” of 112 million barrels of oil.

The company added that Hawkeye is nearby Cinco, another SC 55 prospect believed to contain up to 2.4 trillion cubic feet of natural gas – nearly.

Otto said the Hawkeye well is expected to take around 23 days to drill from the Maersk Venturer’s arrival until release.

“Should the well encounter hydrocarbons, more detailed evaluation, including well logging, will be undertaken, which would increase the overall cost by up to $3 million,” Otto said.

SC 55 is a deepwater block in the southwest Palawan Basin, covering an area of 988 hectares.

“The block is the middle of a proven regional oil and gas fairway that extends from the productive Borneo offshore region in the southwest, to the offshore Philippine production assets northwest of Palawan. SC 55 is not located in disputed territory,” Otto said.

Ty said the DOE has issued a total of 29 SCs allowing private foreign and local firms to seek out new oil and gas basins throughout the country, with the promise that the Philippine government would get ample royalties once resources are discovered and harvested.

Of the 29 SCs, the lawmaker said 16 cover offshore areas in northwest, west, and southwest Palawan, all within the West Philippine Sea.

“Actually, besides the Malampaya natural gas wells, there are other wells in offshore Northwest Palawan that continue to produce small amounts of oil, including Cadlao, Octon, Bonita, Nido, Matinloc, and Galoc,” Ty said.

The largest hydrocarbon deposit ever discovered in the Philippines, Malampaya is believed to contain up to 2.7 trillion cubic feet of natural gas and 85 million barrels of condensate.

Malampaya now yields 146 billion cubic feet of gas every year, and the fuel drives three of Luzon’s largest power plants that are based in Batangas.

As of March 2015, the Philippine government has also earned some P208 billion from Malampaya, which is being run by the SC 38 consortium of Shell Exploration Philippines B.V., Chevron Texaco Malampaya LLC, and PNOC Exploration Corp.