PRESIDENT Rodrigo Duterte and Energy Secretary Alfonso Cusi have signed a petroleum service contract with Israel’s Ratio Petroleum Ltd. allowing the Israeli firm to conduct oil exploration at the East Palawan Basin.
In a statement Thursday, the Department of Energy (DoE) said the petroleum service contract for Area 4 (East Palawan Basin) of the Fifth Philippine Energy Contracting Round (PECR5) was signed on Wednesday at the Heroes Hall of Malacañan Palace.
The service contract deal will allow Ratio Petroleum to explore Area 4, covering 416,000 hectares across the East Palawan Basin for potential oil and gas resources, according to the DoE.
The projected minimum total expenditure is valued at $34,350,000 to be derived from studies, data gathering and drilling activities over the initial seven-year contract duration.
“This is the first petroleum service contract signed under the Duterte administration,” Cusi said.
“In fact, the last service contract awarded was with PXP Energy Corporation. This was almost five years ago in 2013,” he added.
Duterte and Cusi signed the service contract on behalf of the Philippine government, while Ratio Petroleum president and CEO Itay Raphael Tabibzada signed for the Israeli firm.
“The President has been very clear – our country needs to attain energy security and sustainability at the soonest possible time,” Cusi said.
“We are currently experiencing how our dependence on importation has left us at the mercy of price movements in the global oil markets. We need to boost the exploration and development of our own energy resources and the awarding of the petroleum service contract to Ratio Petroleum is a step in the right direction,” the Energy chief said.
The awarded service contract is part of PECR5, which was launched in May 2014.
The PECR was established as a transparent and competitive system of awarding service or operating contracts for prospective petroleum or coal areas within the country.
Established in 1992, Ratio Petroleum has a number of large-scale operations at the Levant Basin in the Eastern Mediterranean Sea, off the coast of Israel, as well as off-shore operations in the Republic of Malta and the Co-operative Republic of Guyana.