By Victor V. Saulon, July 4 2019; Business World

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THE DEPARTMENT of Energy (DoE) has invited local and foreign challengers to the three applications for petroleum service contracts in three areas in the Philippines outside the 14 pre-determined areas it had offered to exploration companies.

In a notice posted on its Web site, the department identified these areas as an area in Sulu Sea, in Northwest Palawan and in Southeast Luzon. These areas are not among those previously offered to interested investors under the Philippine Conventional Energy Contracting Program (PCECP).

The DoE posted the notice to invite counterproposals or challengers as called for under DoE Department Circular No. DC2017-12-0017 or “The PCECP Circular and Guidelines.”

DoE Undersecretary Donato D. Marcos did not immediately respond when asked to identify companies concerned, or whether these are all Filipino entities.

The 60-day challenge period for the Sulu Sea nomination will end at 11 a.m. on Aug. 16, the challenge period for the Northwest Palawan nomination will end at 11 a.m. of Aug. 19, while the challenge period for the Ragay Gulf in Southeast Luzon nomination will end at 11 a.m. of Aug. 20.

Challengers must submit their complete application documents to the DoE records management division and pay the “challenge” fee of P1 million at the department’s treasury division.

Mr. Marcos, who supervises the DoE’s Energy Resource Development Bureau, earlier said that regardless of their method of application, all interested parties must comply with the legal, financial and technical requirements, which include the proposed work program and economic development plan for the contract area.

The PCECP is a transparent petroleum service contract awarding mechanism that allows the government to develop and utilize indigenous petroleum resources under a service contract with qualified local and international exploration companies.

Under the PCECP, awarding of service contracts is conducted either through a competitive selection process or through nomination.

The DoE said it has so far received 21 requests from 11 companies for area clearances covering portions of the Sulu Sea, Recto Bank, Palawan, Quezon, Albay, and Mindoro.

Of the 21 requests, seven area clearances had been issued as of June 25. Area clearances are issued by the department to inform interested parties that there is no overlap between the areas they are looking to explore and other energy projects or restricted areas.

Of the seven companies that have received their area clearances, four have submitted their letters of intent for the department’s approval and subsequent publication as a PCECP-nominated area, it said. — Victor V. Saulon