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            Petroleum exploration in the Philippines dates back to 1896 with the drilling of Toledo-1 in Cebu Island by Smith & Bell. Widespread exploration activities were carried out from the 1950s to 1970s. Exploration then, was governed by Republic Act No. 387 known as the “Petroleum Act of 1949” which ushered in the era of the concession system.

          The current Service Contract System took effect in 1973 with the enactment of Presidential Decree No. 87, better known as the “Oil Exploration and Development Act of 1972”. With its attractive contractual terms and liberal fiscal regime that are particularly favorable to offshore exploration, activities shifted to offshore areas like the Northwest Palawan Shelf where the first field, Nido, was discovered. Several small fields, all located in offshore Northwest Palawan, were subsequently discovered and produced.

            In 1989, relatively large fields were discovered in the deep waters off Palawan when Occidental tested gas in its Camago Structure. Alcorn Philippines, in 1990, discovered the West Linapacan Field and commenced production two years later until 1996. Also in 1990, Shell discovered Malampaya gas field becoming, by far, the largest gas discovery in the country. The field was produced in 2002, providing clean fuel to Luzon grid.

          Onshore in northern Luzon, the Philippine National Oil Company developed the San Antonio Gas Field in 1994 and continues to supply gas fuel to the local electric cooperative in the province of Isabela.


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Last Update : 8 August 2002