PXP Energy gets DOE approval to quit SC 74 drilling in Palawan
By Alena Mae S. Flores – July 19, 2024, 10:00 pm
from manilastandard.net
The Department of Energy approved the relinquishment by the contractors of Service Contract 74 in northwest Palawan led by operator PXP Energy Corp. over alleged lack of “drillable prospects.”
PXP Energy said in a disclosure to the Philippine Stock Exchange Friday it received a letter from the DOE approving the relinquishment of SC 74 which covers an area of about 4,268 square kilometers.
“The DOE has approved the surrender of SC 74 of which PXP has an operating interest of 70 percent. This will not have a material impact on PXP’s 2024 financial statements,” it said.
The other members of the SC 74 consortium are the Philodrill Corp. with 25 percent and state-owned PNOC Exploration Corp. with 5 percent.
PXP sent a letter to the DOE in December 2023 that “no drillable prospects have been identified in the contract area,” leading the consortium to “decide to surrender the service contract.”
Meanwhile, the Philodrill Corp. also disclosed the DOE decision and assured it would comply with the agency’s directives.
Energy Secretary Raphael Lotilla informed the consortium that based on the DOE’s review and evaluation, the contractors had complied with their reportorial obligations.
Lotilla said there remains an outstanding scholarship commitment under the DOE’s Energy Iskolar ng Bayan Program and the agency is currently finalizing the renewal of its memorandum of agreement with Palawan State University, the intended beneficiary of scholarship commitment under SC 74.
“In view thereof, the DOE hereby approves the contractor’s relinquishment of SC No. 74, subject to the settlement of the remaining scholarship commitment in the amount of $55,000.00. The contractors are directed to abandon the contract area and restore all sites that may have been affected by any petroleum operations,” Lotilla said.
DOE Energy Resource Development Bureau director Nonito Jariel said PXP Energy’s action “is their decision, and they are the right party to comment.”
