Cagayan de Oro City 2nd District Rep. Rufus Rodriguez has urged the Department of Energy (DOE) to immediately allow gas exploration in the Recto Bank waters by its service contractor for it to fulfill its contract obligations.
“We understand that Forum Energy is raring to explore Recto Bank for gas and oil. We support the contractor’s plan to go into exploration activities. We call on the DOE to give it its go-signal,” Rodriguez said in a statement.
DOE records show that Forum Energy, which is controlled by billionaire-businessman Manny V. Pangilinan, is required to drill two offshore appraisal wells on or before October 16, 2022 under its service contract, in an area located within the Recto Bank basin.
Recto Bank, also known as Reed Bank, is within the Philippine exclusive economic zone northwest of Palawan, in waters disputed with China.
Rodriguez said DOE and other government agencies concerned, including the Department of National Defense, should help Forum Energy in its undertaking as “they (Forum) are doing it not just for themselves but for the country’s national interest.”
In calling for immediate resumption of oil and gas explorations in Recto Bank, Rodriguez pointed out that Recto Bank is believed to hold gas and oil reserves much larger than those in the Malampaya gas project, also in Palawan.
The Malampaya gas field is the Philippines’ only domestic commercial source of natural gas, accounting for 20% of the country’s total power requirement. The Malampaya concession, however, is due to expire in 2024, with output due to fall starting this year until it becomes commercially unviable by 2027.
On the other hand, the resource potential of Forum Energy’s service contract in Recto Bank is estimated at 165 million barrels of oil and 3.4 trillion cubic feet of gas.
“Recto Bank will be our replacement for Malampaya, and once Malampaya dries up without gas being extracted from Recto Bank, power plants in Luzon would be forced to use more expensive fuel. That will result in an increase in electricity costs in Luzon, which will not be good for us all and the government of President Ferdinand R. Marcos,” Rodriguez pointed out.
The DOE said during the Philippines LNG and Gas summit on September 27, it was already preparing the service contract for the resumption of exploration at Recto Bank, which it hopes would help make up for the impending Malampaya gas loss.