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July 6, 2023 People's Journal 230 views

Work on new Malampaya wells on track, says DOE chief

THE Malampaya consortium, now led by tycoon Enrique Razon’s Prime Infra, is on schedule in its work program which includes the drilling of two new wells.

“The good news that was shared with the President yesterday by the Malampaya consortium is that we are on track to having the first drilling for the nearby fields by the end of 2024 and we are looking forward to new or additional supply from the same service contract by 2026,” said Energy Secretary Rapahel “Popo” Lotilla at the “Pandesal Forum” hosted by Willson Lee Flores.

Lotilla said strong investor confidence also reflects the government’s commitment to achieve and maintain energy security and independence.

“This good news is important in terms of encouraging more investments in exploration in the oil and gas sector,” he said.

President Ferdinand Marcos Jr. signed the renewal of Malampaya Service Contract No. 38 (SC 38) from February 22, 2024 until 2039.

“Ever since (President Marcos) assumed office, he has committed the energy sector towards stabilizing the investment environment…We were able to extend or renew the service contract,” Lotilla said.

The 15-year renewal of SC38 was the green light for the Razon-led operator Prime Energy to carry out drilling beyond the existing production area of the depleting gas field.

“The conduct of exploratory drilling further away from the Malampaya production area within the Service Contract is a requirement for the SC 38 consortium to retain the exploration areas,” said Lotilla.

Aside from continuing production at the existing gas field, SC 38 required the new consortium to submit a minimum work program involving geological and geophysical studies and the drilling of at least two deep water wells during the sub-phase 1 from 2024 to 2029.

The consortium is led by Prime Energy Resources Development B.V. of tycoon Enrique Razon, UC38 LLC, and Philippine National Oil Company-Exploration Corp. (PNOC-EC).

Prime Energy is the gas operator and has a 45-percent stake in the project. UC38 also has a 45-percent stake while the remaining 10 percent is owned by PNOC-EC.

The DOE said the consortium’s work program is “geared towards unlocking the potential both in the existing gas field and nearby prospect areas to provide incremental production.”

The Malampaya field’s best estimate for the near field is an additional 210 billion cubic feet of gas.