Last Oct. 15, 2020, President Duterte announced the lifting of the moratorium on oil and gas exploration in the West Philippine Sea (WPS). The Aquino administration imposed the moratorium in 2014 due to the harassment by Chinese coast guard vessels of Philippine commissioned ships undertaking seismic surveys in the Reed Bank. Forum Energy, which was awarded by the Philippine government Service Contract 72 over Reed Bank, can now resume its exploration activities.
China’s reaction to President Duterte’s announcement showed that China had expected the lifting of the moratorium. The spokesperson of China’s foreign ministry stated on Oct. 18, 2020, that China and the Philippines “have reached consensus on joint exploration of oil and gas resources in the South China Sea and set up relevant consultation and cooperation mechanisms.” Apparently, the lifting of the moratorium is a step in the implementation of the memorandum of understanding (MOU) that China and the Philippines signed on Nov. 27, 2018, to cooperate in the exploitation of oil and gas in the WPS.
The reaction in the Philippine stock market to the lifting of the moratorium was ecstatic. The stock price of two listed companies that hold equity in Forum Energy shot up by almost 50 percent, while the stock price of a third listed company that also holds equity in Forum Energy increased by 39 percent.
Those in the know must be seeing something in the planned acquisition by Dennis Uy of the 45-percent shareholding of Shell in the Malampaya consortium, after the Davao-based businessman had earlier bought the 45-percent shareholding of Chevron in the Malampaya consortium, which owns the underwater gas pipeline that runs from Malampaya to the coast of Batangas.