Philippines May Soon Own Vast Gas-Rich Area

- Philippines May Soon Own Vast Gas-Rich Area

Tuesday, August 16, 2011
Knight Ridder/Tribune Business News
by Cathy Yamsuan, Philippine Daily Inquirer, Manila /

The Philippines will gain 13 million hectares in additional territory, an area slightly smaller than Luzon, should the United Nations approve next year the government's claim on a region off the coast of Isabela and Aurora, Environment Secretary Ramon Jesus Paje said.

Paje said the undersea region, called Benham Rise, could turn the Philippines into a natural gas exporter because of the area's huge methane deposits.

Studies conducted by the Department of Environment and Natural Resources (DENR) for the past five years indicate large deposits of methane in solid form, Paje said after a Senate budget hearing.

The government is only awaiting a formal declaration from the UN Convention of the Law of the Sea (Unclos) that Benham Rise is on the country's continental shelf and therefore part of its territory, Paje said.

Legal basis

Once the Unclos establishes that Benham Rise is part of the Philippines, "we would have legal basis to enter into exploration agreements with private companies to explore...(the area's) resources," said Sen. Franklin Drilon, chair of the chamber's finance committee.

Drilon said a favorable Unclos declaration would mean "increasing our territory from present 30 million hectares to possibly 43 million" with the inclusion of Benham Rise.

Discussion over Benham Rise generated excitement especially after Paje said that Philippine representatives were just awaiting one more meeting "to answer questions" before a special Unclos committee.

Only claim

Paje said there was no reason for the Unclos committee not to issue a decision favorable to the country "since we are the only claimant, unlike in the western side (where the Spratly Islands are)."

"We have submitted a claim under (Unclos) sometime in late 2008. We got a reply from the UN lately (asking us) to answer some questions. They intend to pass a resolution sometime in mid-2012 to approve our claim (that it is) part of the Philippine continental shelf," Paje told reporters after the hearing.

Records showed that the Philippines officially submitted a claim with the UN Commission on the Limits of the Continental Shelf in New York on April 8, 2009.

Davide submission

Hilario Davide, then Philippine ambassador to the United Nations, filed the country's partial submission with the commission.

The United Nations says the continental shelf is "the seabed and subsoil of the submarine areas that extend beyond its territorial sea" up to 370 km (200 nautical miles) from the archipelagic baseline. An extended continental shelf goes farther than 370 km.

The Philippines claims that Benham Rise is an extension of its continental shelf.

Paje said Benham Rise was within the country's 370-km exclusive economic zone.

American geologist

The environment secretary said an American geologist surnamed Benham discovered the area that was between 40 and 2,000 meters below the waterline in 1933.

"But we are able to define categorically that it is attached to our continental shelf only recently. We have proven (to) Unclos that it is attached. So now the UN is considering it for decision sometime in 2012," Paje said.

He said gas deposits in the area would enable the country to achieve energy sufficiency.

"Benham Rise is very relevant because of its gas deposits (which has been) confirmed particularly by (the) National Mapping Resource Information Agency. It has given us the data that (the area) contains solid methane. We have not explored it but we have found nodules of methane in the surface and this is very important to us," he said.

Kalayaan, Scarborough

The Kalayaan Island Group, which is part of the disputed Spratly Islands and Scarborough Shoal, both located in the West Philippine Sea (South China Sea) and claimed by the Philippines, are also believed to contain oil and natural gas.

Paje said there was the possibility that the country could export gas in the future.

The secretary added that there would be a demand for gas deposits in Benham Rise "because it's much cleaner than (other) fossil fuels."

The DENR formally submitted its proposed P16.99-billion (US$40 million) budget for 2012 to the Senate finance committee.

Copyright (c) 2011, Philippine Daily Inquirer, Manila / Asia News Network

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Philippines Set to Seek Oil in South China Sea

- Philippines Set to Seek Oil in South China Sea

Tuesday, August 02, 2011
Dow Jones Newswires
MANILA

The Philippines plans to auction off areas of the South China Sea for oil exploration despite worsening disputes with China over the territory, an official said Tuesday.

Energy Undersecretary Jose Layug said several foreign firms, including China's state-owned CNOOC, had already expressed interest in drilling in waters off the western Philippine island of Palawan.

The areas set for exploration are far from the disputed Spratly islands and well within the Philippines' 200-nautical-mile exclusive economic zone, he said on the sidelines of an energy conference in Manila.

"These are not disputed areas. The area we are offering for bidding is definitely within the territory of the Republic of the Philippines."

However, China is known to claim most of the South China Sea, including areas the Philippines says are clearly Filipino territory.

Aside from CNOOC, two other Chinese firms are among those interested in contracts to drill in the area, Layug said without naming the other two.

The Philippines is to name the winning bidders next year, Layug said.

He expressed confidence the Chinese wouldn't try to harass Philippine-sanctioned oil exploration vessels there.

"These areas are near Palawan which means they (winning bidders) will have to come to the Philippines to do it," he said.

Tensions have risen in recent months, with countries in the region claiming China has been more aggressive in enforcing its claims on parts of the South China Sea.

China, the Philippines, Vietnam, Malaysia, Brunei and Taiwan have overlapping claims to all or parts of the sea, which is believed to be rich in oil and gas deposits.

Last February, two Chinese vessels allegedly harassed a Filipino-commissioned exploration vessel off Reed Bank, an islet north of the Spratlys.

The Philippines has also accused Chinese forces of shooting at Filipino fishermen and placing markers on some of the islets.

The Reed Bank, which Manila calls "Recto Bank" and is also claimed by China, is 273 kilometers from Palawan.

Philippine officials said Manila had previously authorized drilling in that area without any Chinese opposition.

Copyright (c) 2011 Dow Jones & Company, Inc.

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Seismic Prog. Completed at Otto's Well Offshore Philippines

- Seismic Prog. Completed at Otto's Well Offshore Philippines

Thursday, June 23, 2011
Otto Energy Ltd.

Otto announced that the 3D seismic acquisition program commenced earlier in June at SC69, offshore Visayas, Philippines, has successfully been completed. The marine operations for the acquisition along with the onshore support teams have all run very smoothly resulting in successfully acquiring of over 210 km2 of high quality 3D seismic data.

Otto will now move to process the newly acquired seismic data. This will take approximately six months, prior to interpretation.

Otto's Managing Director Paul Moore said "We would like to thank all of our staff, contractors, Government representatives and involved parties in supporting the execution of this project. The program has been run efficiently resulting in a high quality product. We look forward to maturing the Lampos and Lampos South prospects following the interpretation of these new seismic data over the coming months."

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Philippines Welcomes US Help to Contain China

- Philippines Welcomes US Help to Contain China

Tuesday, June 14, 2011
Dow Jones Newswires
MANILA

Philippine President Benigno Aquino said Tuesday his country needed help from longtime ally the United States in its increasingly tense dispute with China over rival claims in the South China Sea.

Aquino accused China of breaking international law by sending vessels into waters claimed by the Philippines and close to its landmass, while portraying his country as weak compared with its militarily superior Asian neighbor.

"Of course they (China) are a superpower, they have more than 10 times our population. We do not want any hostilities to break out," Aquino told reporters when asked about recent Chinese actions in the disputed area.

"Perhaps the presence of our treaty partners, the United States of America, ensures that all of us will have freedom of navigation (and) will conform to international law."

The U.S. and the Philippines are bound by a 1951 Mutual Defense Treaty that calls on both parties to come to one another's aid if either were to be attacked by an external party.

Aquino's comments came after the U.S. ambassador to the Philippines, Harry Thomas, Tuesday said the U.S. remained committed to helping its former colony in any dispute over the South China Sea.

Thomas emphasized at a public forum in Manila that the Philippines and the U.S. were "longstanding treaty allies" and "strategic partners".

"We will continue to consult each other closely on all issues, including the South China Sea and Spratly Islands," Thomas said.

Aquino welcomed Thomas's comments, which are likely to irk China as it has long insisted that the U.S. has no role to play in resolving its territorial disputes with Asian countries.

"We are pleased by that, especially the reiteration that we are a strategic partner," Aquino said when asked to respond to Thomas's comments.

Aquino's remarks continued an escalation in tensions between China, the Philippines and other rival claimants to the strategically vital and resource-rich South China Sea over recent months.

The Philippines and Vietnam, in particular, have expressed alarm at what they say are increasingly aggressive actions by China in the disputed waters.

The Philippines has accused China of putting up posts and a buoy in Philippines-claimed areas of the Spratlys, an archipelago of more than 100 islands and reefs in the South China Sea.

It also accused China of sending naval vessels to intimidate Filipino fishermen and the crew of an oil exploration ship near an atoll called Reed Bank.

Aquino on Tuesday specifically highlighted recent "incidents" at Reed Bank, pointing out it was well within the Philippines' exclusive economic zone of 200 nautical miles.

He said the Reed Bank was just 80 miles from the nearest major Philippine landmass, but 576 miles from Chinese territory.

"Five-hundred-and-seventy-six miles is obviously greater than 200 miles, so why is there suddenly a dispute if we are all conforming to international law," he said.

Under the United Nations Convention on the Law of the Sea, a country's exclusive economic zone extends to 200 miles from its continental shelf.

In response to earlier complaints from the Philippines, China has denied taking any aggressive actions and insisted it remained committed to resolving territorial disputes with its neighbors peacefully.

Aside from China, the Philippines and Vietnam, Taiwan, Brunei and Malaysia have overlapping claims to sections of the South China Sea.

The area is believed to hold major oil and gas deposits, and has commercial shipping lanes that are vital for global trade.

Copyright (c) 2011 Dow Jones & Company, Inc.

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Otto Begins Seismic Acquisition Offshore Philippines

- Otto Begins Seismic Acquisition Offshore Philippines

Wednesday, June 08, 2011
Otto Energy Ltd.

Otto has commenced a 3D seismic data acquisition program in Service Contract 69 (SC 69) in the Visayan Basin of the Republic of Philippines.

The seismic vessel BGP Explorer, operated by Exploiter Pte Ltd (a subsidiary of BGP ), has been contracted to record the seismic data. Otto plans to acquire approximately 210 km2 of 3D seismic data in SC69 (as outlined in the attached map).
SC69 covers an area of 5,280 km2 in the central Visayan Basin where the data acquired from the successful 2D seismic campaign last year confirmed the presence of two sizable reef structures, Lampos and Lampos South that sit immediately adjacent to the Calamangan Trough which is modeled to generate both oil and gas. Current “success case” estimates of oil initially in place in the combined structures range between 22 mmbbls and 713 mmbbls with a mean in place volume of 290 mmbbls.

This survey fulfils the service contract commitments in the current sub-phase.

Otto's Managing Director Paul Moore said, "the ongoing exploration program in the Visayan region of the Philippines is a core part of Otto's exploration program with the 3D seismic currently being acquired ahead of the drilling obligation, in the next sub-phase."

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