RP in talks with Oman for oil supply deal

The state-owned Philippine National Oil Co. (PNOC) is in talks with the government of Oman for possible oil-related development ventures, a ranking PNOC official said.

The official, who is privy to the ongoing negotiations but requested not to be named, told The STAR that the Sultan of Oman has offered a "deal" with PNOC for oil-related projects.

Oman is one of the country’s major oil suppliers.

According to the official, the talks are focused on the security of the supply of oil and the proposed regional stockpile.

PNOC president Thelmo Cunanan confirmed the ongoing talks but declined to give more details. "Give me time to firm this up," he said.

The Philippine government, through the Department of Energy (DOE) and its attached agencies, has been exploring the possibility of tapping other countries for the supply of oil amid the unpredictability of the supply situation in the world market due to the continuing rise in crude prices.

The DOE has earlier explored the possibility of establishing an oil warehouse in Nonoc Island through the Iranian Oil Co. as part of the strategy to expand the country’s oil supply network.

Aside from the Iran-based oil firm, several Russian firms have also expressed interest in Nonoc Island as an oil storage hub.

These include Yukos, one of the world’s largest non-state fully-integrated oil and gas companies with proven oil reserves of 12.581 billion barrels and gas reserves of 4.490 trillion cubic feet.

Another Russian-based oil firm, Sakhalin Energy, a joint venture of Shell, Mitsui and Mitsubishi, has started supplying oil to Shell. At present, Sakhalin Energy supplies high quality oil only to Japan , Korea and Taiwan in the Asian region.

These Russian oil companies were also invited to consider setting up an oil storage facility on Nonoc Island located in Northern Mindanao that may be used as their transit point to distribute products in the Greater Asian region.

Two other major oil companies in Russia - Sibneft and Rosneft - have expressed interest in the exploration sector in the Philippines following discussions on the country’s oil and gas development opportunities.

Meanwhile, Thai oil experts are also scheduled to visit Manila in the middle of this month to firm up talks on another oil hub in Subic.