DOE says Malampaya 15-year extension contract ensures maximum utilization of gas field

DOE says Malampaya 15-year extension contract ensures maximum utilization of gas field

MANILA — President Ferdinand R. Marcos Jr. has signed the Renewal Agreement for the Malampaya Service Contract No. 38 (SC 38), extending the 25-year production contract, which shall expire on 22 February 2024, for a final fifteen (15) more years or until 22 February 2039.

This will allow for the continued production of the Malampaya gas field, ensuring that the remaining gas reserves are further explored and utilized, the Department of Energy (DOE) said Monday.

Aside from continuing the production operations, the SC 38 Consortium is required
to conduct a minimum work program consisting of geological and geophysical
studies and the drilling of at least two (2) deep water wells during the Sub-Phase 1
from 2024 to 2029 the agency added.

This firm work program is geared towards unlocking the potential
both in the existing gas field and nearby prospect areas to provide incremental

The DOE also said that the conduct of exploratory drilling further away from the Malampaya production area within the Service Contract is a requirement for the SC 38 Consortium to retain the exploration areas.

“Should there be failure to comply, the SC 38 Consortium is obligated to relinquish a portion of the exploration areas,” the DOE said.

The discovery of additional reserves in the Malampaya gas field will boost the
country’s quest for energy security. It is also expected to encourage opportunities for
further exploration in the country, which to date remains underexplored, and to add
to the Philippines’ energy portfolio.

In consonance with international oil and gas exploration practice, the SC 38
Consortium is required to submit a Decommissioning Plan and Budget covering the
abandonment of wells and decommissioning of facilities in accordance with
applicable international standards, to include timing and costs, within thirty (30)
calendar days from the effectivity of the Renewal Agreement for approval by the
Department of Energy. (ai/mtvn)

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