President Rodrigo Duterte’s recent visit to China has given PXP Energy Corp., formerly Philex Petroleum Corp., a ray of hope to explore its oil and gas asset in the disputed West Philippine Sea.
PXP Energy chairman Manuel Pangilinan told reporters the company was optimistic on the government’s recent alliance with China. The Energy Department has suspended service contract 72 at the Recto Bank following the territorial dispute with China over certain islands in the area.
“It’s (service contract) suspended so on that basis, … we cannot undertake any activities in the area without DeE consent. Our work for them is also suspended. We will not explore until the government lifts the suspension,” Pangilinan said.
Duterte’s visit to China has raised the possibility of a joint exploration over the disputed areas in the West Philippine Sea. Aside from SC 72, exploration on other service contracts in the area were also suspended by the government due to the territorial dispute.
“I think it offers some hope that there could be some understanding with China on at least explore what might be there,” Pangilinan said.
The Philippines and China earlier in a joint statement agreed “to continue discussions on confidence-building measures to increase mutual trust and confidence and to exercise self-restraint in the conduct of activities in the South China Sea that would complicate or escalate disputes and affect peace and stability.”
“In this regard, in addition to and without prejudice to other mechanisms, a bilateral consultation mechanism can be useful, which will meet regularly on current and other issues of concern to either side on the South China Sea. Both sides also agree to explore other areas of cooperation,” the statement read.
PXP Energy, the oil and gas arm of Philex Mining Corp., owns majority indirect and direct stake in Forum Energy Plc, which holds a 70 percent interest in SC 72.
The company earlier welcomed the ruling of the Permanent Court of Arbitration in The Hague released on July 12 on the maritime case filed by the Philippines against China.
The tribunal ruled that the Recto Bank, where Service Contract 72 lies, was within the Philippines’ exclusive economic zone as defined under the United Nations Convention on the Law of the Sea.
PXP Energy, through Forum, said it would take guidance from the government on any future activity in SC 72 and other areas covered by the tribunal’s decision.