Author Topic: Service Contract 72: Reed Bank  (Read 3470 times)

adroth

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Service Contract 72: Reed Bank
« on: August 11, 2017, 01:26:22 AM »
Time for a quick review of Reed Bank exploration. Let's start with what led up to the halting of exploration activities in 2015





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PHL stops oil and gas drilling in Reed Bank, cites dispute with China
Published March 3, 2015 12:19pm

http://www.gmanetwork.com/news/money/companies/445665/phl-stops-oil-and-gas-drilling-in-reed-bank-cites-dispute-with-china/story/

(Updated 4:47 p.m.) The Department of Energy (DOE) has 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 a territorial dispute between the Philippines and China.
 
Philex Petroleum Corp., which holds a substantial stake in SC 72, confirmed the DOE action in a disclosure to the Philippine Stock Exchange on Tuesday.

The other stakeholder in SC 72 is Monte Oro Resources and Energy Inc., according to previous filings of Philex Petroleum with the Philippine Stock Exchange.
 
"Forum Energy, the UK incorporated oil and gas exploration and production company with a focus on the Philippines, today confirms that the Philippine Department of Energy (DOE) has granted a force majeure on Service Contract (SC) 72, because this contract area falls within the territorial disputed area of the West Philippine Sea which is the subject of an United Nations arbitration process between the Republic of Philippines and the People’s Republic of China," the disclosure read.
 
Philex Petroleum holds a 60.49 percent interest in Forum Energy – which operates SC 72 in Reed Bank – also called Recto Bank, covering the Sampaguita Gas Field as well as several oil and gas leads. In turn Forum Energy has a 70 percent in SC 72.
 
Under the terms of the force majeure, Philex Petroleum said all works related to oil and gas exploration in the area were immediately suspended from 15 December 2014 until the DOE notifies the company that drilling and exploration may commence.
 
"As a result, the second sub-phase of SC 72 has been put on hold until further notice," the company said. "The terms of the second sub-phase and all subsequent sub-phases will be extended by the term of the force majeure."

< Edited >
« Last Edit: September 11, 2019, 12:32:34 AM by adroth »

adroth

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Re: Service Contract 72: Reed Bank
« Reply #1 on: August 12, 2017, 05:49:10 AM »
Background on this SC

https://www.pxpenergy.com.ph/service-contracts/sc-72

Forum (GSEC 101) Limited(Operator): 70%

The Recto Bank concession of SC 72 is located in the West Philippine Sea, west of Palawan Island and southwest of the Shell-operated Malampaya Gas Field. Formerly Geophysical Survey and Exploration Contract (GSEC) No. 101, SC 72 was awarded to Sterling Energy Ltd in June 2002 and covered an initial two-year term.

In April 2005, Forum Energy acquired the concession from Sterling and became its operator. In 2008, Monte Oro acquired a 30% interest in the block upon payment of a portion of the past costs and expenses of Forum Energy.

On 15 February 2010, the licence was converted to a Service Contract and Forum Energy immediately conducted geological and geophysical works to further evaluate the block and to fulfil its commitment to the government. SC 72 covers 8,800 square kilometers, which is 85% of the area of GSEC 101.


Exploration

Exploration in the area began in 1970, and in 1976, gas was discovered in the Sampaguita structure following the drilling of a well. To date, a total of three wells have been drilled at the southwest end of the structure. Two of the wells tested gas at rates of 3.6 mmscf/d and 3.2 mmscf/d.

In mid-January to mid-March 2011, Forum Energy acquired 2,202 line-km of 2D seismic, gravity, and magnetic data over SC 72 to further define leads. Also, 565 square kilometers of 3D seismic data were acquired over the Sampaguita field.

The interpretation of these surveys was carried out by Weatherford Petroleum Consultants (“Weatherford”) in 2012. The report indicated the Sampaguita Gas Field to contain contingent resources of 2.6 trillion cubic feet (TCF) Gas in Place (GIP).

The 2D seismic data were reprocessed in 2013 and were subsequently interpreted, aided by gravity-magnetics data that were interpreted by Fugro (2012) and Cosine, Ltd. (2015). In 2015, Arex Energy produced a report on the North Bank area and estimated the prospective resources to be 3.1 TCF.

SC 72 has been under Force Majeure since 15 December 2014 due to the West Philippine Sea maritime dispute. Forum plans to drill two wells over the Sampaguita Field once the Force Majeure is lifted.
« Last Edit: September 11, 2019, 01:41:32 AM by adroth »

adroth

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Re: Service Contract 72: Reed Bank
« Reply #2 on: August 12, 2017, 05:49:23 AM »
TBA

adroth

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Re: Service Contract 72: Reed Bank
« Reply #3 on: May 12, 2018, 04:40:51 PM »
PH to have control over China in Service Contract 57
Published March 5, 2018, 3:49 PM
By Argyll Cyrus Geducos

https://news.mb.com.ph/2018/03/05/ph-to-have-control-over-china-in-service-contract-57/

Malacañang said that China would have to comply with Philippine laws in case the joint exploration in Service Contract (SC) 57 pushes through, as the area is under the exclusive economic zone (EEZ) of the country.

Presidential Spokesperson Harry Roque issued the statement days after he announced that there are two areas that may be subjected to joint exploration by the Philippines and China, namely SC 57 and SC 72.

Roque, in a Palace press briefing Monday, said that since SC 57 is under the Philippine EZ, China would have to comply with domestic laws.

“As far as 57 is concerned, they will comply with the decision with La Bugal [ruling]. They can participate in exploration and exploitation provided, as the decision says, we have ultimate control over the exploration and the development,” Roque said.

The Palace official also confirmed that China would be under the control of the Philippines during the joint exploration on SC 57.

“They’re only a foreign entity engaged in exploration and development. But they have to do it under Philippine laws,” Roque said.

“They will absolutely be subject to Philippine laws if it is [SC] 57. It would have to be the mining code. The domestic law of the Philippines will prevail over [SC] 57,” he added.

< Edited >

According to the Philippine National Oil Company (PNOC), SC 57 was awarded to PNOC Exploration Corporation (EC) on September 15, 2005. It covers a total area of 7,120 sq. km. in offshore Northwest Palawan and is situated around 50 kilometers northwest from the north-westernmost tip of Busuanga Island.

However, Roque said the same does not apply to SC 72 as there is an ongoing dispute in the said area between the Philippines and China.

SC 72 was awarded to Sterling Energy Ltd in June 2002. It is located in the West Philippine Sea, west of Palawan Island and southwest of the Shell-operated Malampaya Gas Field. SC 72 covers 8,800 square kilometers.

As to [SC] 72, the agreement on joint exploration will be governed by international law because there has to be a treaty to be signed between the Philippines and China first on the joint exploration before it can be implemented by juridical entities of the contracting states,” Roque said.

“That’s why if we enter into an agreement, we’ll have to spell out the respective rights and obligations of the parties by way of a compromise,” he added.

< Edited >

adroth

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Re: Service Contract 72: Reed Bank
« Reply #4 on: September 11, 2019, 12:25:39 AM »
DoE to hold talks with China on exploration in disputed sea
September 28, 2017 | 12:10 am
By Victor V. Saulon

https://www.bworldonline.com/doe-hold-talks-china-exploration-disputed-sea/

THE DEPARTMENT of Energy (DoE) is looking at including the existing ban on oil and gas exploration in the South China Sea in bilateral talks with its Chinese counterpart this week, its top official said.

“We are still studying the ways we are going to lift the moratorium order, but I don’t like to create any speculation. We have not reached any agreement yet,” DoE Secretary Alfonso G. Cusi told reporters on Wednesday on the sidelines of the 35th ASEAN Ministers on Energy Meeting in Pasay City.

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Separately, DoE Undersecretary Donato D. Marcos said the bilateral talks with China would cover not just service contracts in the disputed waters but also those wherein a favored foreign investor could “farm in.”

Of the pending oil exploration service contracts, he said Service Contract (SC) 57 is likely to proceed first. “We have SC 57. That is already in the Office of the President. So that we can pursue its exploration work,” Mr. Marcos said, adding that the DoE has finished the documentation and contract for President Rodrigo R. Duterte’s signature.

< Edited >

Located offshore northwest Palawan, SC 57 was awarded to PNOC Exploration Corp. in September 2005.

China National Offshore Oil Co. International Ltd. acquired 51% participating interest in the contract in April 2006, while Mitra Energy Ltd. acquired 21%. Its deed of assignment remained pending with the Office of the President.

SC 57 is currently under force majeure although exploration activities are expected to resume once approval is granted.

Mr. Marcos said service contracts 58, 63, 72 and 75 are within the disputed areas and remain a sensitive issue for the claimant countries. But he said he was hopeful of a resolution.

< Edited >

adroth

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Re: Service Contract 72: Reed Bank
« Reply #5 on: September 11, 2019, 06:01:52 AM »
Forum Energy, Monte Oro to redo survey of SC 72
Danessa Rivera (The Philippine Star) - April 1, 2019 - 12:00am

MANILA, Philippines — The contractors of Service Contract (SC) 72 in the West Philippine Sea have invested $490,000 or over P25 million to redo survey works, which is expected to be completed by the second quarter.

The consortium composed of Forum Energy Ltd. and Monte Oro Resources and Energy is currently undertaking 3D seismic data for the Sampaguita gas discovery, PXP Energy Corp. said in its definitive information statement.

The broadband and pre-stack depth migration reprocessing of the data with  DownUnder GeoSolutions started in October last year.

“The reprocessing work is expected to cost around $490,000, including quality control supervision, and will be completed within the second quarter of 2019,” it said.

This activity is necessary before it can start drilling within the prospect.

The group hopes to resume exploration and drilling works in the Sampaguita discovery, which has the potential to contain approximately 2.5 trillion cubic feet of recoverable gas and could be the country’s new source of gas as replacement for the Malampaya project.

The contract for the Malampaya gas field in northwest Palawan will expire in 2024, but this can be applied for extension with the Department of Energy (DOE).

< Edited >

It had asked the Philippine government, through the DOE, to lift the force majeure imposed on SC 72 in December 2014 so it can implement its work program.

The request follows the Philippines-China cooperation on joint oil and gas development signed in November last year. Both nations have one year to further discuss plans on how to pursue joint activities.

< Edited >

Read more at https://www.philstar.com/business/2019/04/01/1906149/forum-energy-monte-oro-redo-survey-sc-72#1wC5vrDRP7Isbuws.99

adroth

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Re: Service Contract 72: Reed Bank
« Reply #6 on: January 04, 2020, 02:02:18 PM »
3 major China-PH projects  starting
Published January 4, 2020, 12:30 AM

https://news.mb.com.ph/2020/01/04/3-major-china-ph-projects-starting/

Three  major  China-Philippines  projects  took off in the closing months  of 2019 – the start of the Reed Bank  joint  gas and oil development west of Palawan,  President  Duterte’s directive to proceed  with the P12.2-billion  Kaliwa Dam project  in Rizal and Quezon, and the roll-off of the P175-billion 650-kilometer South Rail Long Haul project  in Bicol.

These  are  three  of the projects  funded  by grants and loans from China.  These grants  totaled  $398 million in 2019,  with $400 million more expected  in  2022. These  are  on  top of  $500 million in soft loans granted for 2020 and planned in succeeding  years.

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Aside from  Reed Bank, Kaliwa Dam, and  South Rail,  other new projects under “Package  2” are due to start,  including the Mindanao Railway,  the Davao Expressway, and the Iloilo-Guimaras-Negros bridge.  This may  yet be  the biggest year  in Philippine-Chinese economic relations.
« Last Edit: January 04, 2020, 02:06:15 PM by adroth »

adroth

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Re: Service Contract 72: Reed Bank
« Reply #7 on: January 04, 2020, 02:21:52 PM »
DFA's Locsin, Chinese envoy discuss oil and gas devt in New Year meet
Published January 3, 2020 8:56pm
By MICHAELA DEL CALLAR

https://www.gmanetwork.com/news/news/nation/720971/dfa-s-locsin-chinese-envoy-discuss-oil-and-gas-devt-in-new-year-meet/story/

Foreign Secretary Teodoro Locsin Jr. and China's top diplomat to Manila discussed the proposed oil and gas development between the Philippines and China at a New Year reception on Thursday.

< Edited >

Manila and Beijing were considering exploring for oil and gas in still undetermined areas in the West Philippine Sea, which may include the Reed Bank, a resource-rich area within the Philippines Exclusive Economic Zone but being claimed by China.