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Cusi seeks lifting of oil exploration ban in WPS

Energy Secretary Alfonso Cusi is pushing for the lifting of the moratorium on oil and gas exploration in the West Philippine Sea.

Cusi said the lifting of the ban, which was imposed amid the territorial dispute with China, would enable the oil and gas industry to drill more wells and increase local production.

“The lifting of moratorium will help our effort. That’s why we have been asking for the lifting of the moratorium, but again we defer to DFA [Department of Foreign Affairs]. Again, there is a diplomatic issue that is being addressed, but I am pushing for its lifting and for immediate resumption of exploration,” Cusi said.

Energy Secretary Alfonso Cusi
Cusi said the government aimed to generate strong support from the oil and gas industry for the 14 pre-determined areas offered by the Department of Energy under the Philippine Conventional Energy Contracting Program.

“We really need to develop our own source for our own national security.  That is our aspiration.  At present, our drilling is very low. We are only averaging, during the last [Aquino] administration, it was three [wells a year],” Cusi said.

He said an average of eight wells were drilled a year during the term of former President Gloria Macapagal Arroyo.

“During this administration, we are having the difficulty, but we are rushing it.  We are pushing it because the only way for us to find oil is to explore, and we know the difficulty of exploring.  So the more we explore, the more that our chances will be higher,” the energy official said.

He said other countries drilled an average of 29 to 40 wells drilled annually.

Cusi said he was hoping the industry would be able to drill at least two wells in the 14 pre-determined areas on offer.

“Why we are pushing it? Because we want to find oil,” he said, adding that the industry also faced challenges such as the corporate income tax interpretation by the Commission on Audit.

“The issues haunting us are, the taxes, the sharing of the taxes and our reputation of us changing the rules of the game.  That is creating uncertainties,” he said.

The oil and gas industry almost came to a halt amid the territorial dispute with China on the West Philippine Sea, which prompted some companies to call for a moratorium of their service contracts.

Another concern is the ongoing arbitration case filed by Shell Philippines Exploration B.V. on its tax dispute with the Commission on Audit.

Topics: Energy Secretary Alfonso Cusi , oil and gas exploration , West Philippine Sea , WPS
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