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PIA Press Release
2007/09/11

DOE: All set for oil exploration at Tanon Strait

By Minerva BC Newman

Cebu, Philippines (11 September) -- The Department of Energy (DOE) is all set for another oil/gas exploration at the Tanon Strait in the Central Visayas seas.

DOE declared this during its briefing cum seminar to launch its IEC plan for the project held at the Midtown Hotel, Cebu City recently.

According to DOE Asec Francisco Delfin, the exploration is contracted to Japan Exploration Ltd (JAPEX) under service contract (SC-46) that acquired 2580 sq.km area covering 13 barangays in Pinamunghan and Alguinsan towns in Cebu ; 14 towns and cities in Negros Oriental and 4 towns in Negros Occidental.

DOE-7 regional director Antonio Labios said, the drilling is still for exploration purposes and geophysical studies to test and/or confirm results of the seismic surveys that were done at the Bohol-Cebu seas last month.

Delfin said, oil and gas exploration at the Tanon Strait started in 1978 with Shell Phils. Based on satellite data, the Visayan Basin manifested signs of oil and gas resources, DOE reported.

In the same briefing, Hirotaka Tanaka, OPNS manager of JAPEX reported that all the preliminary activities, documentations, reports as well as community consultations and other activities that are needed to start the drilling exploration have already been complied with including the ECC that DENR granted on March 7, 2007.

Tanaka said, JAPEX is an oil and gas exploration company that was established in 1955 and has done exploration projects around the world for more than 50 years now.

Recently, the company introduced a very advance technology on drilling-the SAGD technology (Steam Assisted Gravity Drilling) that it has used in its oil explorations in Indonesia and Malaysia since the 1960s.

Tanaka described JAPEX's drilling exploration activity at the Tanon Strait as very advance in technology and environmentally safe allaying apprehensions from some groups that the exploration at the Strait will harm the marine life at the area.

DOE and JAPEX assured the public that the drilling exploration will not cause any environmental destructions of marine life in the area because the exploration sites are so deep, there are no coral growths.

He said that JAPEX will use the Mobile Offshore Drilling Unit (MODU) that will be anchored in a 1.5 km radius within the Pinamungahan and Aloguinsan seas and "we will use the Extended Reach Drilling Technology (ERDT) here, the same technology we applied in Russia-Sachalin-1 project," Tanaka added.

JAPEX explained that the drilling is very safe because first, they will drill a26" hole down the ocean floor and set a 20" casing for cementation. Then they will drill an 8.5" hole for a wire-line logging to measure chemical and geological data.

If they believe that there is gas, they will set a 7" liner (steel pipe) to test the well but if gas and oil is negative, they plug the well with cement and abandon it. Another well within the contracted area will be drilled until they are certain of their data and information.

Tanaka added that using the advance ERD Technology, JAPEX discovered 35 oil /gas fields in Japan and 7 fields are still producing oil and natural gas.


Exploration and production updates

DOE also reported that in 2006, it has granted seven (7) oil exploration contracts three (3) of which were in Palawan ; SC-58 at the west Calamian Block, Northwest of Palawan with Nido Petroleum undertaking the contract. Another was the west Balabac/Southwest Palawan under SC-59 by the PNOC-EC and at the Northeast Palawan under SC-60 by Shell Philippines Exploration (SPEX).

Four (4) other service contracts have been awarded to the Petroleum sector of the Philippine Energy Contracting Round (PECR) in 2005 and they were undertaken in Palawan and Sulu seas, the DOE added.

DOE website data revealed that explorations in 2006 included Nido Petroleum's 3D seismic data and survey of a 581 sq.km of seas that are still being carried out until the target of 824 sq. km are achieved.

Another six (6) exploration companies-SPEX, CNOOC, Nido Petroleum, NorAsian, PNOC-EC and Mitra Energy have acquired a total of 11,168 line km of seas for their 2D seismic surveys.

DOE also reported that as of November 2006, the Phiodrill Corp. produced 162,963 barrels of crude oil while Nido and Matinloc Fields in offshore Palawan have produced 106,939 and 156,024 barrels respectively.

Shell Philippines Exploration (SPEX) n the other hand produced some 103,328.98 mmscf of gas and 4,908,180.87 barrels of condensate from its Malampaya field, while PNOC-EC had produced a total of 292.89 mmscf of gas from its San Antonio field in Isabela, the DOE website report said

As of January this year, DOE said it has approved 28 active service contracts; one (1) geophysical survey and exploration in the Reed Bank Basin and another term of service signed on March 17, 2006 for the PNOC-EC Camago-Malampaya oil leg.

DOE's oil/gas explorations in various fields in the country have yielded sustainable results. Alcorn Philippines discovered the West Linapacan Field in 1990 and began production in 1992 until 1996.

In the same year (1990), Shell Phils. Exploration discovered the Malampaya gas field which is considered by far, the largest gas discovery in the country. The gas field started oil production in 2002 and now providing clean fuel to the Luzon grid.

On shore in Northern Luzon, PNOC-EC developed the San Antonio Gas Field in 1994 and it continues to supply gas fuel to the local electric cooperative in the province of Isabela in Luzon.

Finally, DOE bared in its website: www.doe.gov.ph that petroleum reserves in the country in 2005 totaled 456-million barrels of fuel oil equivalent that is composed of 25-million barrels of oil; 2.135-billion cu.ft. of gas and 54-million barrels of condensate.

These petroleum reserves estimates according to DOE are based on the 16 sedimentary basins situated all over the country from the Cagayan Valley Basin to the Agusa-Davao Basin including the prolific Northeast Palawan and the Sulu Sea Basins.

The current oil/gas exploration at the Tanon Strait, if found to be of commercial value, is expected to boost the country's oil reserves and improve the energy capacity of the Viasayas regions. (PIA-7) [top]

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