The Philippines president approved the contracts following the decision by the country’s Supreme Court to declare the Philippine Mining Act to be constitutional.
The Japex contract will see the Japanese firm exploring for oil and gas in the Tanon Strait off Negros Occidental. The SSPHL contract covers oil exploration in the Agusan-Davao Basin in Davao. The first phase of exploration in the acreages, which involve geophysical surveys, is expected to cost Japex US$500,000 for Tanon and SSHL US$200,000 for Agusan-Davao.
Japex will invest US$3 million to drill the first appraisal well, while SSHL will spend US$750,000 for its exploration well. Both firms are expected to drill between three to four wells each.
“With prices of oil soaring, any discovery will be a big boost to our economy and energy independence,” said energy secretary Vincent S. Perez was reported as saying in the Manila Bulletin daily.
Perez was also optimistic for the BHP Billiton-led project to explore two blocks in the Sulu Sea would be approved by year’s end. He said final negotiations with BHP Billiton (and its partners Unocal, Amerada Hess and Sandakan Oil) had been prolonged due an earlier Court decision.
“We hope to finally seal an agreement with the consortium before the year ends,” Perez said.
Under its proposed work program, BHP Billiton will initially invest $1.65 million for the conduct of geophysical studies and plans to drill four wells with a total cost of $32 million, according to a Manila Times report.
