(Updated 4:47 p.m.) The Department of Energy (DOE) has suspended all drilling and exploration works in the West Philippine Sea, particularly in the area covered by Service Contract (SC) 72 in the Reed Bank, citing a force majeure as the site is the subject a territorial dispute between the Philippines and China.
Philex Petroleum Corp., holds a substantial stake in SC 72, confirmed the DOE action in a disclosure to the Philippine Stock Exchange on Tuesday.
The other stakeholder in SC 72 is Monte Oro Resources and Energy Inc., according to previous filings of Philex Petroleum with the Philippine Stock Exchange.
“Forum Energy, the UK incorporated oil and gas exploration and production company with a focus on the Philippines, today confirms that the Philippine Department of Energy (DOE) has granted a force majeure on Service Contract (SC) 72, because this contract area falls within the territorial disputed area of the West Philippine Sea which is the subject of an United Nations arbitration process between the Republic of Philippines and the People’s Republic of China,” the disclosure read.
Philex Petroleum holds a 60.49 percent interest in Forum Energy – which operates SC 72 in Reed Bank – also called Recto Bank, covering the Sampaguita Gas Field as well as several oil and gas leads. In turn Forum Energy has a 70 percent in SC 72.
Under the terms of the force majeure, Philex Petroleum said all works related to oil and gas exploration in the area were immediately suspended from 15 December 2014 until the DOE notifies the company that drilling and exploration may commence.
Read more: http://www.gmanetwork.com/news/story/445665/economy/companies/phl-stops-oil-and-gas-drilling-in-reed-bank-cites-dispute-with-china