Forum Energy to drill for oil in Recto Bank

MANILA, Philippines - London-listed Forum Energy Plc., a unit of Philex Petroleum Corp., has received the green light from the Department of Energy (DOE) to conduct a drilling survey in a petroleum exploration area located in the disputed West Philippine Sea.

The UK oil and gas company holds the exploration license for Service Contract 72, which covers Recto Bank.

“The survey was approved by the DOE as part of the work program for 2015 but still waiting for their advise on schedule,” said Philex Petroleum chairman Manuel V. Pangilinan.

The target is to conduct the survey this year, he said.

The survey will help determine which areas have strong potential for oil and gas.

Drilling in the area has been stalled due to geopolitical tensions between the Philippines and China.

Phoenix Petroleum holds a 60.45 percent in Forum, which holds a 70 percent operating interest in SC 72 located in the West Philippine Sea.

In August 2012, the DOE issued a moratorium on all exploration and drilling works in the area due to an ongoing territorial dispute with China, prompting the company to seek an extension of the work program.

The DOE earlier extended Forum’s exploration license by another year, or from August 2015 to August 2016, due to delays in the work program.

The company earlier sought a first extension of its work program in January 2013.

Forum also went into talks with CNOOC (China National Offshore Oil Co.), China’s state-owned oil producer, for a possible commercial arrangement covering Recto Bank but discussions have stalled.

 “The last time we talked to them was in 2013,” Pangilinan said.

To date, the talks have not been revived or formally closed.