 SC 60, converted from the Geophysical Survey and Exploration Contract 99 or GSEC-99, covers a relatively unexplored area of one million, eight thousand (1,008,000) hectares. Northeast Palawan is one of the promising sites for petroleum exploration identified by the Philippine Petroleum Resource Assessment Project Study conducted by the Norwegian Agency for Development Cooperation (NORAD) and the DOE.
During the seven-year exploration period of SC 60, the consortium committed a minimum of US$24 million or about P1.27 billion for the project. The consortium shall conduct, seismic and exploration work to find petroleum and optional exploration drilling within the first 7 years. SC 60 also includes a 25-year production term in the event of a commercial discovery of petroleum. SC 60 partnership is comprised of 55% stake by SPEX, 30% by KUFPEC Phils. and 15% by SCR.
Signatories of SC 60 are Secretary Raphael P.M. Lotilla for the DOE, SPEX Managing Directors Keith Perrin and Paul van der Harten, KUFPEC Deputy Chairman and Chief Operations Officer Abdullah M. Baroun, and SCR Chairman Edgardo Reyes. Present to witness the signing was Mr. Wouter Hoogeveen, Shell Exploration and Production Vice President for Exploration – Asia Pacific Region, Kuwaiti Ambassador to the Philippines Bader Nasser Alhouti, KUFPEC’s Manager for Far East & Australia Region, Mr. Adel al-Khayat and KUFPEC Senior Legal Officer Mr.Steve Byrom.
Energy Secretary Raphael P.M. Lotilla said the signing of SC 60 is a further boost for foreign investment in the country’s energy sector. “It is our hope that this new investment will result in a successful petroleum find and help push forward the country’s drive for energy independence in the midst of surging oil prices,” he said.
Meanwhile, Wouter Hoogeveen, Shell’s Regional Vice President for Exploration in the Asia Pacific, said “I am very pleased with the award of this contract which gives Shell and its partners the opportunity to explore the relatively unexplored area east of Palawan Island. SCR Chairman Edgardo Reyes on the other hand echoed Sec. Lotilla’s hopeful message, while KUFPEC Deputy Chairman and Chief Operations Officer Abdullah M. Baroun described the deal as a significant step for KUFPEC in the region and expressed sincere wishes for success in this project and the boost this would give to the Philippines’ economic growth. The consortium is a group with strong background in the upstream petroleum industry. SPEX is the operator of the Malampaya Gas to Power Project while KUFPEC is a wholly owned subsidiary of the Kuwait Petroleum Corporation, owned by the State of Kuwait. On the other hand, SCR is a Philippine company involved in, among others, hydrocarbon exploration. With the signing of SC 60, there are now 14 service contracts which have already been signed by the DOE on behalf of the government since December 2004. These service contracts involve a total of US$193 million in financial investments committed to work programs for the exploration of oil and gas in the country.
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