File photo from Bongbong Marcos FB page/PTV

President Ferdinand “Bongbong” Marcos Jr. on Tuesday said the upcoming conduct of an on-site survey in the old Cadlao oil field has attracted “strong interest” from foreign investors in the country’s upstream oil and gas sector.

This, after the Department of Energy (DOE) allowed Nido Petroleum Philippines (NIDO) to proceed with the on-site survey of drilling locations in their service contract areas by the last quarter of 2022.

NIDO is the operator of Service Contract (SC) 6B in the Palawan basin.

The activities will pave the way for the drilling of two wells – one exploration and one appraisal, by the first half of 2023.

For SC 6B, the appraisal well for the Cadlao oil field could lead to early oil production towards the second half of 2023 while the recoverable volumes expected from the oil field are 5 to 6 million barrels of oil.

“While it is a first step, it signals the government’s intent to maximize indigenous resources and has attracted strong interest from foreign investors in the Philippine upstream oil and gas sector,” Marcos said in a press statement.

Cadlao is an old oil field that was last produced in the early 1990s with over 11 million barrels.

The operatorship of this oil field was taken over by Nido Petroleum from Forum Energy Philippines Corporation (FEPC) in February 2022 to fund the 100 percent development costs, which include drilling, extended well tests, and subsequent development of the said oil field.

“The Government’s commitment to preserve and maintain the investment incentives for service contractors under Presidential Decree 87 has been met with renewed confidence and strong interest by local and foreign investors in the oil and gas sector,” Marcos said.

The PD 87 or the Oil Exploration and Development Act of 1972, issued by Marcos’ father, former President Ferdinand Marcos Sr., provides that the government is entitled to the equivalent of 60 percent of net proceeds from the sale of petroleum.

In his first State of the Nation address on July 25, Marcos said the government “will provide investment incentives by clarifying the uncertain policy in upstream gas, particularly in the area close to Malampaya.”

Upstream refers to the exploration and production stages in the oil and gas industry. (PNA)

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