Recto Bank the only replacement to Malampaya

By: Engr. Edgar Mana-ay

IT’S ALL OVER the newspapers the past two months that natural gas supply from the Malampaya offshore source in Palawan seas will run out in four years time. For the past 45 years, natural gas from the Malampaya gas fields supplied via a submarine pipeline to Batangas provides FORTY PERCENT, repeat, 40% of the fuel supply for electric power plants in Luzon.

Just imagine a 40% loss of electric power and that’s the reason why First Gen of the Lopez group is putting up a $1.2-billion liquefied natural gas storage in Batangas in preparation for IMPORTATION of LNG (liquefied natural gas).

Without Malampaya, everybody knows that importation at P5 billion per month of LNG is a tremendous economic burden to our country.

Recto Bank (formerly known as Reed Bank) is a large table mount (a flat-topped mountain range under the sea sometimes also called seamounts or guyots) in the South China Sea covering an area of 8,866 square kilometers (sq. km.). Its sea cover has a shallow depth ranging from 9 meters to only 45 meters and only requires 3,000 meters below sea bed of drilling to reach the gas/oil deposit. This makes it very ideal and economical for offshore exploration and drilling, unlike in the Gulf of Mexico where water depth can be 1,800 meters before drilling another 5,000 meters to reach the oil or gas deposit.

According to the Permanent Court of Arbitration ruling in 2016, the Recto Bank area is within the Philippine Economic Exclusive Zone and yet China is disputing the ruling, causing a stoppage to Philippine-sponsored exploration activities in the area in 2016. The disputed Reed Bank (Recto Bank) could hold up to 500 million barrels (1 barrel is 159 liters) of oil and 4 trillion cubic feet of natural gas, enough to supply Luzon’s energy needs for more than 50 years. The Department of Energy confirmed that natural gas deposit at the Recto Bank is bigger than that of Malampaya.

Ownership of Recto Bank is beyond dispute since it is only 70 nautical miles west of Palawan, nearly twice as close to the mainland than Scarborough Shoal off Zambales province and part of the Spratly island chain. China insists on claiming both Recto and Panatag Shoal even though they are within the Philippine’s 200-mile exclusive economic zone. OWNERSHIP OF NATURAL GAS DEPOSIT AT RECTO BANK IS OURS. IT IS BEYOND DISPUTE!

According to then Pres. Noynoy Aquino in one of his State of the Nation Addresses (Sona): “stepping on Recto Bank is just like stepping on Avenida Rizal in Sta. Cruz Manila” (The new name of old Avenida Rizal is now C.M. Recto Avenue). That’s why the Chinese militia vessel that rammed a Filipino fishing vessel on anchor at Recto Bank should NOT be there in the first place.

The author had experienced coal and geothermal exploration (the search, investigation, and confirmation of energy deposits/resources) and therefore can say that offshore exploration for oil and gas is more difficult. While preliminary investigations, like seismic survey, were made many years ago at the Recto Bank, it was stopped in 2016 because of the illegal claim of China. It is the educated guess of this writer, considering the work already done in the area, at least two more years is required for final and intensive exploration work and then another three years to drill and install the infrastructures to produce the natural gas. With the Malampaya field exhausted in four years, the minimum five years of preparation to produce from Recto Bank, ASSUMING WE ARE NOT AFRAID OF CHINA, will not be on time to replace Malampaya.

Our government initiated the natural gas exploration in the area as early as the 1980s, but since there was no market yet for LNG it was held in abeyance and the area called SC 72 (SC for service contract) was awarded to Forum Energy a consortium led by Manny V. Pangilinan. Just like in coal, areas in the Philippines with potential energy deposits are divided by the Department of Energy into service contract areas (it is 500 hectare per service contract in the case of coal which this writer is very familiar as a coal exploration and drilling manager). The service contract (SC) areas are then awarded by DOE to companies with the capability to explore, develop and exploit the energy resource be it oil, gas or coal.

Lately, DOE Undersecretary Jose M. Layug has given Forum Energy the go signal to resume exploration work at SC72. Forum Energy is bent on pursuing its activities within SC 72 despite security problems it faced when its exploration boat was “approached” by two Chinese patrol boats. This is the irony of it all: being bullied at our own backyard by a faraway neighbor. The argument of kuno a very brave Duterte is that protecting our own rights might result in a war with China. This is a very stupid and simplistic theory which any expert on international law and relations will debunk. Mas bug-at pa ang away sang US and Iran and yet it has not resulted in a full-blown war. We still have the United Nations, the U.S. and the Asean countries as our allies whom China cannot afford to be a pariah because its export economy is fully dependent on them.

We must secure and defend Recto Bank at all cost. We will not allow China’s protest and pestering to disrupt our efforts to harness Recto Bank’s oil and gas assets as replacement of Malampaya. For according to a Persian proverb: “He who wants the rose must not be afraid of the thorn.”

Note: The writer is a retired Exploration Drilling Manager of PNOC Coal Corporation.