By Myrna M. Velasco

President Rodrigo Duterte will formally sign in Malacañang next week the service contract (SC) of Israeli firm Ratio Oil Exploration Ltd. for a petroleum block in Northwest Palawan basin.

Energy Secretary Alfonso G. Cusi disclosed to reporters that the service contract signing and award shall be formally consummated at the Palace on October 8 this year.

“There’s a formal signing next week. It will be a Malacañang signing… at the Office of the President,” he stressed.

Sealing the SC deal for Ratio Oil was initially scheduled during President Duterte’s visit in Israel last month, but there were some other preparations that relevant government agencies needed to complete relative to the petroleum block’s award.

According to the DOE, it shall be the President who will be signing the contract with the awardee-firm – that is in keeping with the Supreme Court jurisprudence on the Japan Petroleum Exploration Co. Ltd. (Japex) case, which effectively negated the power of the Energy Secretary as a signatory to petroleum service contracts.

The formal award of Ratio Oil’s service contract had been delayed since 2015 due to confluence of factors that plagued the country’s upstream oil and gas sector.

The company won the service contract in the last Philippine Energy Contracting Round-5 that the DOE had undertaken three years ago. The block covers an area of 416,000 hectares with potential for 1.2 million barrels of oil; and 2.062 billion cubic feet of gas.

It was gathered from Malacañang sources that the Israeli firm submitted a waiver that whatever would be the final ruling on the Malampaya tax case, it is not going to drag the Philippine government to judicial suits.