By Myrna M. Velasco
State-run Philippine National Oil Company (PNOC) has sealed a memorandum of understanding with Israeli firm Ratio Petroleum Ltd. for oil and gas exploration ventures along Philippine basins.
The deal was signed by PNOC President Reuben S. Lista and Ratio Petroleum Ltd. Chief Executive Officer Itay Raphael Tabibzada; and was witnessed by Energy Secretary Alfonso G. Cusi.
Under the pact, it was stipulated that the MOU “seeks to establish cooperation between the two parties for the exploration and development of oil and gas in the Philippines.”
There had been no particular blocks or service areas identified by the two firms yet, although PNOC previously indicated that it has been eyeing several blocks in the pre-determined areas (PDAs) being tendered under the Philippine Conventional Energy Contracting Program.
Essentially, this will already be an expansion venture for Ratio Petroleum which just signed around October last year its awarded petroleum service contract straddling East Palawan basin.
That particular block spans 416,000 hectares; and Ratio Petroleum had committed US$34.5 million capital outlay for geological survey, data gathering and drilling activities covering its initial seven-year work program that had been submitted to the Department of Energy.
On Ratio Petroleum’s new deal with PNOC, it was noted that the parties set out “cooperation in the conduct of research and feasibility studies,” as well as “the exchange of technical information.”
PNOC and Ratio Petroleum will also work together on securing necessary permits and clearances, “and the sharing of technical resources and capabilities for project development.”
As a mother unit, this will be PNOC’s first investment foray into the upstream petroleum sector – although its subsidiary PNOC-Exploration Corporation is minority shareholder in the multi-billion Malampaya gas field project.
In the scheduled contracting round for the 14 petroleum blocks being offered by the DOE, the deadline of submission will be next month – hence, the tandem of PNOC and Ratio Petroleum could be among those that could be watched closely if they will ever advance on targeted ventures.
Another mode of submitting offers under the PCECP is via nomination, which may be done year-round by prospective investors on petroleum blocks of their preference.