Lucio Blanco Pitlo III

Opinion | Will Philippines’ Marcos Jnr revive talks on China oil deal to solve looming energy crisis?

The Philippines and China signed a memorandum of understanding for oil and gas cooperation in 2018, but talks were called off after negotiations failed to bear fruit

Chinese interference and Manila’s inability to attract big oil players have hindered attempts to exploit energy resources in the West Philippine Sea

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Philippine President Ferdinand Marcos Jnr. Photo: AFP

Lucio Blanco Pitlo III

Published: 10:00am, 11 Aug 2022

Rising demand, diminishing resources and a looming energy crisis may set the stage for reviving talks for a proposed joint oil and gas development between Manila and Beijing in the West Philippine Sea.

However, constitutional and legal constraints, and concern about undermining a 2016 arbitral award, complicate Philippine President Ferdinand Marcos Jnr’s desire to pursue a pragmatic way out of the country’s energy woes.

Senator Robinhood Padilla on July 21 filed a resolution urging for the resumption of bilateral discussions for possible joint development in the maritime hotspot.

The resolution came a month after former Secretary of Foreign Affairs Teodoro Locsin announced the termination of talks in a farewell speech a week before the Duterte administration bowed out of office to make way for the new Marcos government.

The Philippines and China signed a memorandum of understanding for oil and gas cooperation in 2018, but three years of negotiations did not bear fruit and Manila’s attempts to exploit its offshore energy resources in the West Philippine Sea continue.

As the fastest-growing economy in Southeast Asia, the Philippines’ fuel consumption has picked up as it gradually recovers from the coronavirus pandemic. But an imminent energy crisis due to the conflict in Ukraine has cast a shadow on this positive outlook.

If the war in Ukraine, now in its fifth month, persists, the coming winter may exacerbate the global energy conundrum. This puts oil importers such as the Philippines in a vulnerable situation, increasing calls to harness local energy resources to reduce external dependence and enhance energy security.