The Philippine government on Wednesday inked a historic oil exploration agreement with an Israeli company to improve the country’s energy security and lessen its dependence on imported fuel.
President Duterte signed the petroleum service contract for the East Palawan Basin with Itay Raphael Tabibzada, president of Israel-based Ratio Petroleum Ltd.
Presidential spokesperson Salvador Panelo said the agreement was signed during a closed-door ceremony at Malacañang on Wednesday.
“This is the first petroleum service contract signed by the President under his administration,” Panelo said in a press briefing on Thursday.
Constitutionality of deal
Ratio Petroleum was given an initial seven-year contract to explore Area 4, covering 416,000 hectares of the East Palawan Basin, for potential oil and gas resources.
At least $34.3 million will be spent for studies, data gathering and drilling.
Panelo said this was not the country’s first joint exploration deal with a foreign company, citing a 2013 deal with a private company to explore northwestern Palawan.
He expressed confidence about the constitutionality of the deal with the Israeli company should it be challenged in the Supreme Court.
“We feel that the Constitution does not prohibit this particular kind of agreement. Of course, there will be others who will be questioning that again in the Supreme Court,” Panelo said.
Energy security
The Philippine government, he said, is optimistic that oil resources will be discovered in the joint oil exploration deal with Ratio Petroleum.
“If you remember, the President made statements that our country needs to attain energy security and sustainability at the soonest possible time,” Panelo said.
Borrowing the President’s often-quoted line, he said that the Philippines was unfortunate not to have substantial oil resources, making it dependent on imported fuel.
“We don’t have our own oil, so we are really at a disadvantage compared to other countries that have oil,” he said.