Philex's drilling plan in S.China Sea pushed back to 2015

Posted at 01/28/13 12:26 PM

MANILA - A unit of Philippines' Philex Petroleum Corp is extending a drilling program in contested waters in the South China Sea by two years to 2015, the companies said on Monday. 

Forum Energy Plc  originally set a deadline of until August this year to drill two appraisal wells at the Sampaguita natural gas field on Reed Bank under Service Contract 72 awarded to it by the Philippine government. 

But competing territorial claims of China and the Philippines have jeopardised Forum's plans to further explore the Sampaguita gas field where reserves are believed to reach up to 20 trillion cubic feet.  

China lays claim to virtually all the South China Sea while the Philippines and neighbours Brunei, Taiwan, Malaysia and Vietnam claim certain parts. 

Forum had dropped a plan to deploy a survey vessel to Reed Bank in October. In March 2011, two Chinese vessels threatened to ram a survey ship contracted by Forum in the Reed Bank area. 

In a move that China says further complicates the issue, Manila has asked the tribunal of the U.N. Convention on the Law of the Sea to order a halt to China's activities in the area. 

"The deadline for completion of the second sub-phase, comprising the drilling of two appraisal wells, has now been extended by two years to 14 August 2015," Forum said in a statement accompanying a Philex Petroleum disclosure to the Philippine Stock Exchange. 

The companies said the move has received the approval of the Southeast Asian nation. 

Philex Petroleum, a unit of the Philippines' top gold and copper producer Philex Mining Corp, holds a 60.49 percent direct and indirect interest in Forum. 

U.K.-listed Forum said further details regarding its plans for SC 72 will be made in due course. 

On Jan. 17, Philex Mining Chairman Manuel Pangilinan said the Sampaguita project's success hinged on either joint exploration with China or U.S. support if the country took on the venture alone. 

Forum has had talks with Chinese state-owned offshore oil producer CNOOC  on joint exploration at Reed Bank.