IN any negotiation for a possible joint exploration for oil and gas in the West Philippine Sea, Filipino officials will insist on a 60-40 sharing scheme with China, and the latter can walk away from the table if it does not want that, Foreign Affairs Secretary Teodoro L. Locsin Jr. said on Monday.
However, Locsin added that if China accepts the sharing, then that means China has decided it is worth their investment.
“What if China doesn’t agree and wants it equal?” host Karen Davila asked Locsin on ANC.
“Then they walk away because we cannot…it’s not allowed by our domestic law,” the country’s top diplomat said, adding that the sharing arrangement is not even mentioned in the memorandum of understanding (MOU) that he and Foreign Minister Wang Yi signed in the presence of President Duterte and visiting Chinese leader Xi Jinping on November 20.
“But certainly, when the working group [goes] into it, they will understand that they must operate on the Philippine side, within Philippine law, 60-40. But the Chinese side, they will also understand the Philippines needs to proceed on the basis of Philippine law. They can either walk away from the table or agree to it,” added Locsin.
He discouraged the facile conclusion that China has given in when it accepts the 60-40 in Manila’s favor. “No,” Locsin said, that simply means, “China has decided it’s worth the price of investment, 60-40.”
Locsin said that, under international law, the MOU does not create rights or obligations, “but when it comes to sharing domestic law, we don’t really change [what the Constitution says],” adding that “the most sustainable growth of a country should not be at the expense of another… and the national progress is not a zero-sum game.”
Locsin said the alleged (Sen. Antonio F.) Trillanes documents, purporting to show a different sharing scheme, should not be believed because, “It does not exist, it does not even make sense.”
Market price
The secretary said he talked with a Filipino expert, whom he will not name, who was involved in the discovery of a huge oil reserve off Beijing who told him that the sharing arrangement “should be determined after the cost covered by both sides [are computed].”
“It will then be determined according to the market price of oil and or gas.”
Former Secretary of Foreign Affairs Alan Peter Cayetano, on one of his press briefings, said the country has agreed to have a joint agreement to search for oil and gas because “China will provide the capital, manpower, and technology.”
He added that the 60-40 sharing agreement has been adopted in the Malampaya gas field in Palawan.
Cayetano said experts have determined that the natural gas in Malampaya would last only until 2027 or 2029 and that the country needs to find an immediate replacement, which could potentially be those that could be found in the WPS.
The incumbent energy secretary, Alfonso Cusi, had described the MOU signed during the Xi visit as something vital to efforts to harness new energy sources, given the huge challenge in sustaining the country’s robust economic growth.
Cusi this week presided at the latest round of energy contracting, in a bid to lure more petroleum players to invest in the Philippines’s search for new energy.
In a 2017 event hosted by Shell Philippines— leader of the consortium operating the Malampaya gas field—Shell’s country manager Cesar Romero, citing company data, said: “Based on what we know, it depends on the drawdown; there could be supply until 2027 to 2029.”
Agreements reviewed
Meanwhile, Locsin, explaining the origin of the MOU draft, said: “No there was never [a Trillanes draft], there was just this draft, and then let me tell you the truth.
“This agreement [waving the document] and all the others and the rest of the 29 [agreements from the November 20 visit of Xi] were not revealed to the public immediately. To begin with, the reason I was here from Asean instead of going with the President [Duterte] to Papua New Guinea was because only seven documents had been cleared. So I came back to Manila and went over all the rest and started approving them and then they were all included.”
He said he and Finance Secretary Carlos Dominguez worked on the agreement “because I trust him.”
“So we just cursorily looked at it, there’s no danger to National Security or anything like that. There were agreements on certain roads on certain dams, etc., and then suddenly they [Malacañang] were swamped with 29 documents,” meaning he submitted the finished documents to the Palace for official release.