Friday, July 24, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
BURGUNDY GLOBAL Exploration Corp. may soon start drilling at the Camago-Malampaya oil leg off the Northwest Palawan Basin, according to Philippine National Oil Company Exploration Corp. (PNOC-EC).
"They might drill towards the end of the year. And they might be able to get their first oil in the first quarter of 2010," Jacinto V. Paras, PNOC-EC chairman, said.
"The only assumption to be affected is something to do with the pricing of gas. The time it was awarded it was about $100 per barrel. But according to them $60 a barrel is still a reasonable business decision," Mr. Paras added.
The Camago-Malampaya oil leg is a joint venture project executed in July last year with Burgundy having 84.9% ownership and PNOC-EC with 15.1%.
Mr. Paras added that Burgundy has partnered with the Norwegian government for the financing of equipment.
Should Burgundy find oil, Mr. Paras said the government stands to gain 15% of the revenues, with an option to buy an additional 15% of the shares.
The Camago-Malampaya oil and gas fields in northern Palawan has been reported to have a gas potential which could support 3,000 megawatts of gas-fired power plants for over 20 years.
Pilipinas Shell Petroleum Corp. and Chevron Philippines, Inc. work on the gas fields while Burgundy and PNOC-EC are in charge of the oil project.
The oil reservoir is contained within the Malampaya gas field covered by Service Contract 38.
The field has been said to contain 2.5 trillion-3.2 trillion cubic feet of reserves.
In a separate interview, Finance Secretary Margarito B. Teves said the government is still eyeing the partial privatization of PNOC-EC within the year.
Selling 40% of PNOC-EC could raise P10 billion to P11 billion for the government.
Mr. Teves, however, said the date may be changed depending on the market conditions.
"Timing could change within the year ... it could be later but our direction is towards the disposal of 40% share of PNOC-EC," Mr. Teves said.
"There are [takers] but I think the prospective buyers will come to the picture only when these things are clarified and when they have the chance to conduct due diligence," Mr. Teves said.
In another development, PNOC-EC yesterday declared P1.002 billion worth of dividends, as a result of its P3.05-billion net income in 2008. The government owns 99.78% of the firm.
PNOC-EC shares last traded on Wednesday at P10.25 per share, the same as the previous day’s close. — Jose Bimbo F. Santos
_____________________________________________________________________________________
