DOE temporarily suspends work at Alegria oil, gas site

Chinese firm lacks envt’l compliance certificate, envt’l impact assessment study among others

Production works at the onshore gas and oil site in Alegria town have been temporarily suspended pending documentary requirements.

According to the Department of Energy (DOE), the Chinese firm conducting the construction activities in Barangay Montpeller, was already preparing the area being drilled for actual extraction as well as a temporary storage for the oil when it was ordered suspended by the DOE last week.

“We asked them to stop the construction for the time being until they are able to comply with the requirements and documentation for the extraction.

This is for the safety and health in the area,” said DOE Visayas Field Office (VFO) Director, Engineer Saul Gonzales.

Among the documents that the China International Mining Petroleum Company Limited (CIMP) has to secure are an environmental compliance certificate (ECC) and an environmental impact assessment (EIA) study from the Department of Environment and Natural Resources (DENR) and the Environmental Management Bureau (EMB).

They will also be needing a permit to haul, store, refine, and distribute from the DOE.

To recall, the DOE and CIMP, its partner exploration firm, declared that commercial quantities of natural gas and oil were found in the site in Alegria town which could last for 19 years based on current production levels.

Exploration and drilling in the oil field by CIMP started as early as 2009 and was covered by Petroleum Service Contract No. 49 issued by the DOE.

An estimated 27.93 million barrels of oil with a possible production recovery of 3.35 million barrels, or a conservative estimate of 12 percent of total oil reserves, were found in the area.

About 9.42 billion cubic feet (bcf) of natural gas reserves were also found, with the recoverable resource estimated at 6.6 bcf, or about 70 percent of the total natural gas reserves.

According to Gonzales, most of the documents that the CIMP has to secure will be done through the DOE central office.

The Visayas Field Office, he said, would be the one to monitor the actual situation in the area.

It was through this local monitoring that the DOE found out about the activities in the oil site which prompted them to order for its suspension.

The Chinese firm assured though that they would comply with the documentary requirements.

“That was the advice of the VFO since it is also dangerous. They were amenable. They said they will comply with the requirements. They said they will push through with the project,” he said.

Gonzales said that CIMP really planned to push through with operating and managing the oil site on their own.

As to how it would be used or if it would be exported out of the country, he said, it would be up to the Chinese firm although there was still no definite decision so far during a meeting between CIMP, the DOE, and the Cebu Provincial government.

The discovery of the oil site is also expected to help the local government unit of Alegria as it will generate jobs for people in the town.

The town is also expected to get a share of the income from the project.