MVP open to US, Chinese partners in Recto Bank

MANILA, Philippines - American investors may participate in the Philippines' largest natural gas find -- but only if the potential Chinese partners would agree.

This is according to Manuel V. Pangilinan, chair of the firm awarded by the government the right to explore gas deposits in Recto Bank off Palawan coast.

Pangilinan, who has previously confirmed meeting with state-owned Chinese National Offshore Oil Corp (Cnooc) for a possible commercial arrangement, said on Thursday, June 14, he is open to forming a multi-country partnership involving Forum Energy, which was granted Service Contract 72 (SC-72) for the natural gas project.

"As to whether there are other parties that might come in, that's possible. We'd like to see that but it will be a function of the view of Cnooc. We have no problem with US companies," he told reporters at the sidelines of a stockholders' meeting of Philippine Long Distance Telephone Co (PLDT), which he also chairs.

He was replying to questions regarding his recent trip to the US where he was part of President Aquino's business delegation. In a speech, he reached out to business leaders at the newly formed US-Philippines Society, which he explained "is geared towards enriching the long ties between the US and the Philippines."

Pangilinan explained that his speech was meant to stress that, "apart from the feel good factor (that) we're allies and we died for you all the way from the battle of Manila Bay to World War II and Vietnam, we have to make this relationship profitable for both of us in more commercial terms than diplomatic ones."

"I'm a business person. If we could increase our trade, increase investments, address tourism, that would be the goals I'd be looking at as a business person," he added.

Foreign partner   

Be it Chinese or American, Pangilinan has said that Philex needs to take on a foreign partner for the Bank, which showed a potential of producing 16.6 trillion cubic feet of gas.

"Typically, a gas field will need a major expenditure with the help of international oil firms with the technical capability and financial resource of some size. It is important, if not critical, for us to partner with one or more than one international oil companies. We recognize that we cannot do this on our own," he told reporters in May.

Which country Pangilinan chooses has implications on national security.

Recto Bank is about 148 kilometers off the Philippine island of Palawan. But China claims nearly all of the disputed area, even waters close to the coasts of Southeast Asian nations.

Talks between Pangilinan's camp and the Chinese state-owned firm Cnooc were considered a commercial solution to the territorial dispute between the two countries.

Asked if bringing in an American partner could calm down the Philippines' tense relationship with China, Pangilinan said, "Security concerns are frankly beyond me, I think that's a government issue. We're obviously keen to learn about them because it will impact on several of our activities and the country's interest. Like as you know, the South China Sea is principally a security concern."   

Meanwhile, Pangilinan-led Forum Energy and its local partners are shelling out $75 million to explore the Sampaguita gas fields at Recto Bank to fulfill the work program it submitted to the Philippine government as required under the SC-72 franchise. There is pressure to set up an oil rig, since the consortium currently has until August 2013 to drill. - Rappler.com