Continue reading »]]> DOE to open bidding for oil and gas exploration

The Philippine Department of Energy (DoE) is set to open the bids for oil and gas exploration in the country this April.  Part of the Philippine Energy Contracting Round (PECR) 4, there are 15 areas for bidding – 3 onshore and 12 offshore sites. These areas are estimated to generate investments worth USD500 million per area. 
There are 41 prequalified exploration companies including British firms, Shell and
Pitkin Petroleum.   

Galoc resumes production

According to Galoc Production Company, operator of the Galoc oil field, it will resume production in Galoc this April after a refurbishment shutdown.  Forum Energy has 2% interest in the production. Its refurbishment included maintenance and inspection works and upgrade of systems.  A plan to move to Phase 2 development of the oil field is underway. Galoc field is located offshore Palawan and is under the Service Contract 14C.  

Natural Gas Reserves in Recto Bank

UK registered firm, Forum Energy, reported that Recto Bank may have 16 trillion cubic feet of natural gas.  This is based on the interpretation of the 3D and 2D data acquired from the Sampaguita Gas Field. Recto Bank under SC 72 is within the Spratlys Group of Islands, part of which is in dispute due to territorial claims of various Asian countries including China.  Local company, Philex Mining has major interest in Forum Energy are now looking for
funding to push through with the exploration. SC 72 covers 880,000 hectares of Recto Bank.  This is within the country’s 200-nautical-mile exclusive economic zone based on Republic Act 9522, or the Philippine Archipelagic Baselines Law, signed on March 10, 2009.

Information from the UKTI Asia Pacific Oil & Gas Newsletter.

Continue reading »]]> The Rotary Club of London (RCL) is the largest Rotary Club in the capital and is celebrating its 100^th anniversary this year.  The International Committee of RCL has joined forces with the Rotary Club of Pampanga Norte (RCPN) to assist a project in Pampanga Province in the Philippines to improve community health and school sanitation.  In order to help raise funding for the project, RCL are organising a Philippine International Evening at the Rotary International District 1130 Headquarters, 6 York Gate, Marylebone Road, London NW1 4QG on Saturday 26^th May.  This particular project was chosen out of several others as being the most likely to succeed due to the presence of the Pampanga Norte Club who will administer the funding.

The British Embassy in Manila and the Philippine Embassy in London have encouraged us to enlist the help of the Co-Chairmen of the Philippine British Business Council to ask if you may be able to assist RCL in its effort to raise funds for this extremely worthwhile project with a financial donation.  We realise that you will have existing policies towards charitable giving but we hope that, given your particular interest in the Philippines, and the importance of the project to Pampanga Province, you may be willing to consider this particular event as worthy of support.  In return we are more than happy to exhibit corporate logos etc on wall space in the venue.

Click HERE to read a copy of the flyer for this event together with a complete copy of the project itself for your evaluation.  I am sure you will agree that it is indeed worthy of support.  The Philippine Ambassador, Mr Enrique Manalo, has given his blessing to this event and hopes to be able to attend himself barring another priority taking precedence.  Indeed, we hope that you yourself will be able to attend.  The RCL and the RCPN do hope that supporters of the Philippines will give this their early and close attention and consider a donation in the region of up to £500.

Donations and ticket applications should be sent to the address in the flyer. Cick on the links below:

Event Flyer No.2

Project Detail RT12-Intl-Pampanga-22 Mar

Continue reading »]]> Invitation to bid to provide a new ICT solution for Philippine’s land transportation system.

The UKTI website is reporting that The Philippine government is inviting bids to provide them with a new ICT solution for the country’s land transportation system. The new system will be expected to handle some 18 million transactions annually, or around 126 million transactions over a seven year period. It must also be capable of web-based, kiosk, and desktop transactions.

Bidders must be able to design, build, operate, service and maintain the new computer system and have a proven track record of implementing and maintaining wide-scale ICT systems.

For further information on this business opportunity and help with the tender process, you must register with the UKTI team in Manila through the UKTI website.

The link to register is here.

Continue reading »]]> This 2012 Outlook has been provided by the Philippines Embassy in London and shows a strong developing position in many areas, with commercial opportunities appearing in a number of sectors.

• ·         Expect acceleration of public expenditures to continue well into 2012 and beyond, as well as substantial acceleration of disbursements, including those for infrastructure and capital outlay, in the coming months. 

• ·         Investment is expected to post a strong growth in 2012 despite the global economic uncertainties, as we anticipate strong investments from both public and private sectors.  The construction sector will get a boost from public construction in 2012 due to continued spending for the government’s Disbursement Acceleration Program’s projects that were carried over from the previous year, and from the faster budget execution process of government. Construction will also get a boost from the acceleration of the implementation of the Private-Public Partnership program this year.

• ·         In addition, expect that private construction will remain robust, particularly in the property sector, given the upward momentum in the office sector, and the relatively high BPO office demand in strategic areas across the country.  Also expect the residential sector to remain supported by the demand from families of overseas Filipinos.  

• ·         There is likewise an expected expansion of investments in energy; mining; low-cost housing and office buildings; and the industries in the priority areas – agribusiness, consumer durables, information technology (IT), health and wellness, transport, telecommunications, and especially tourism to contribute positively to the country’s economic growth in 2012.

• ·         The performance of the real estate sector will be complemented by the continued robust performance of the business process outsourcing industries. Meanwhile, the performance of the other services sector will benefit from the surge in tourism as we improve our infrastructure, intensify our tourism marketing campaigns, and maintain a favorable peace and order situation.

• ·         Food manufacturing will benefit from stronger consumer demand spurred by government spending, softening prices of raw materials, and better weather conditions. In the second half of 2012, the manufacturing sector is expected to post a remarkable growth as the food sector further expands, election spending provides an impetus up to the national and local elections in 2013, and the electronic industry registers higher growth.

• ·         On the expenditure-side, the resilient domestic economy will support a continued expansion in household consumption expenditure. Household consumption will be spurred by the continued tripartite efforts of the government, private employers and workers to improve the country’s labor and employment situation; a sustained inflow of overseas Filipinos remittances which has been counter-cyclical in the past; and the implementation of social protection programs.

• ·         While NEDA is optimistic that 2012 will be substantially better than 2011, it remains vigilant and continues to closely monitor external developments that continue to pose significant risk to the country’s growth.   As many analysts expect, global economic recovery might stall in 2012 mainly due to the growing concerns over Europe. The International Monetary Fund projects the Euro area will suffer a mild recession due to lingering concerns on how to appropriately and quickly restore confidence in the economy in order to support growth while at the same time addressing fiscal imbalance and providing more liquidity and monetary accommodation. Similarly, the government is also watching closely developments in the U.S. economy, whether the recovery will gain momentum or will remain fragile. Likewise, the government recognizes the risk that China could slow down or even experience a “hard landing.”  

Continue reading »]]> We publish here an extract from the UKTI’s Asia Pacific Oil & Gas Newsletter which covers several of the countries in the Asia Pacific Region. Information in relation to Oil & Gas in the Philippines compiled by UKTI officers in relevant British High Commissions is included here.

2 big foreign firms eyes Philippines refinery facilities

According to DoE Secretary, Jose Almendras, 2 big foreign firms are eyeing the

Philippines for their refinery facilities. Mr Almendras is promoting the country as a

strategic location for refinery hubs for the Asean market.

Liberated Power Plant opens new natural gas plant in Cebu City

A new natural gas plant was opened in March at Cebu City. The Libertad Natural

Gas Power Plant will generate 1,000 kilowatts of additional power to supply areas in

Cebu. This is the 3rd natural gas plant in the country, the other 2 are the

Malampaya and San Antonio Gasfield. Libertad Power Plant is operated by Forum

Energy in partnership with DESCO Inc.

San Miguel looks at LNG/CNG

San Miguel Power Holdings, one of the biggest players in the local power industry,

is looking at liquefied natural gas (LNG) or compressed natural gas (CNG) for its

planned power facilities. The company has 6 proposed facilities to be set-up in

major areas of the country including Cotabato, Leyte, Panay, Bulacan and Cavite.

Oil exploration to commence at Recto Bank

The Philippine government announced that oil exploration in Recto Bank (Reed

Bank) is commencing this year (2012). As the government stressed, the area is

not part of the territorial dispute amongst Asian countries.

Department of Energy identifies 8 companies undertaking drilling

activities in 2012

The Department of Energy has identified the following companies undertaking the

drilling activities in the country for 2012:

(1) Blade Petroleum for Service Contract (SC) 6 Cadlao Block in offshore

northwest Palawan;

(2) Galoc Production for SC 14C (northwest Palawan);

(3) PNOC Exploration Corp. for SC 37 in the Cagayan Basin and SC 63 in

southwest Palawan;

(4) Gas2Grid for SC 44 in the Visayan Basin;

(5) CIMP for SC 49, also in Visayas;

(6) Frigstad Energy for SC 50 in northwest Palawan;

(7) Pitkin Petroleum for SC 53 in the Mindoro-Cuyo Basin; and

(8) BHP Billiton for SC 54 and SC 59, both within southwest Palawan.

Continue reading »]]>  The UKTI has identified a number of PPP Projects in the Philippines and these are listed below. Jeremy Browne, Minister of State in the Foreign and Commonwealth office, recently visited The Philippines where a major focus on PPP projects was identified.

The Department of Transportation & Communication has announced the rollout of projects in the railways and other mass transport infrastructure. But there are still concerns about the clarity of DOTC’s contracting structure and regulatory procedures and the changing project timetables. 

We understand the tender for LRT 1 extension project will issued by April.UKcompanies are now participating in public tenders on infrastructure projects for education and healthcare.

Continue reading »]]> These economic figures and 2012 Outlook have been provided by the Philippine Embassy in London and show that despite the general world economic troubles, The Philippines is continuing to grow with a remarkably good economic outlook.

The Philippine Government has increased the spending on infrastructure projects.

The Philippine Economy

• The Philippine economy grew by 3.7 percent in the fourth quarter of 2011, from 3.1 percent and 3.6 percent in the second and third quarters, respectively.   

• The corresponding full year 2011 real GDP growth of 3.7 percent is lower than the 7.6 percent rate of 2010 but within NEDA’s growth forecast of 3.6 to 4.0 percent for the year.   

• A myriad of external shocks buffeted the economy since the beginning of the year, starting from the MENA crisis and the resulting high oil prices, the Japan and Thailand tragedies with their resulting supply chain disruptions, and the overall weakness of the world economy due in large part to the weaknesses in the European and U.S. economies. In addition, weather disturbances affected agriculture and infrastructure during the year. 

• There was rapid acceleration in public construction expenditure, which grew by 49.4% in the fourth quarter, to make up for government underspending.  The increase was largely due to the government’s Disbursement Acceleration Program as well as the continuous speeding up of the implementation of various government programs and projects.

• The Aquino administration expects the economy to grow by 5 percent to 6 percent in 2012.

Remittances from the UK

These have hit an all time high and in 2011 were just under $1 billion.

         Jan – Dec 2011 (in USD)

         2011                                              2010                                      Growth Rate %

         956,639,000                                 888,959,000                        7.61

• Also for the first time in history, tourism arrivals from the United Kingdom breached 100,000 in a year, coming in at 104,466 for 2011, 7.78% higher than the registered visitors of 96,925 in 2010

2012 Outlook

• Expect acceleration of public expenditures to continue well into 2012 and beyond, as well as substantial acceleration of disbursements, including those for infrastructure and capital outlay, in the coming months. 

• Investment is expected to post a strong growth in 2012 despite the global economic uncertainties, as we anticipate strong investments from both public and private sectors.  The construction sector will get a boost from public construction in 2012 due to continued spending for the government’s Disbursement Acceleration Program’s projects that were carried over from the previous year, and from the faster budget execution process of government. Construction will also get a boost from the acceleration of the implementation of the Private-Public Partnership program this year.

• In addition, expect that private construction will remain robust, particularly in the property sector, given the upward momentum in the office sector, and the relatively high BPO office demand in strategic areas across the country.  Also expect the residential sector to remain supported by the demand from families of overseas Filipinos.  

• There is likewise an expected expansion of investments in energy; mining; low-cost housing and office buildings; and the industries in the priority areas – agribusiness, consumer durables, information technology (IT), health and wellness, transport, telecommunications, and especially tourism to contribute positively to the country’s economic growth in 2012.

• The performance of the real estate sector will be complemented by the continued robust performance of the business process outsourcing industries. Meanwhile, the performance of the other services sector will benefit from the surge in tourism as we improve our infrastructure, intensify our tourism marketing campaigns, and maintain a favorable peace and order situation.

• Food manufacturing will benefit from stronger consumer demand spurred by government spending, softening prices of raw materials, and better weather conditions. In the second half of 2012, the manufacturing sector is expected to post a remarkable growth as the food sector further expands, election spending provides an impetus up to the national and local elections in 2013, and the electronic industry registers higher growth.

• On the expenditure-side, the resilient domestic economy will support a continued expansion in household consumption expenditure. Household consumption will be spurred by the continued tripartite efforts of the government, private employers and workers to improve the country’s labor and employment situation; a sustained inflow of overseas Filipinos remittances which has been counter-cyclical in the past; and the implementation of social protection programs.

• While NEDA is optimistic that 2012 will be substantially better than 2011, it remains vigilant and continues to closely monitor external developments that continue to pose significant risk to the country’s growth.   As many analysts expect, global economic recovery might stall in 2012 mainly due to the growing concerns over Europe. The International Monetary Fund projects the Euro area will suffer a mild recession due to lingering concerns on how to appropriately and quickly restore confidence in the economy in order to support growth while at the same time addressing fiscal imbalance and providing more liquidity and monetary accommodation. Similarly, the government is also watching closely developments in the U.S. economy, whether the recovery will gain momentum or will remain fragile. Likewise, the government recognizes the risk that China could slow down or even experience a “hard landing.”  

Continue reading »]]>

• Growth for the first nine months of 2011 was at 3.6 percent, below the lower end of the whole year target of 4.5 percent.   
• Debt problems of trading partners, low government spending, decline in agriculture and fishing due to unfavourable weather and the high cost of fuel were factors that contributed to the relatively low growth.
• Consumer Spending and the Services sector help save the domestic economy, the latter recording 1.2 percent growth for the third quarter from 2.8 percent in the previous quarter, as all subsectors recorded positive growth.
• Government believes there are more favorable prospects for the fourth quarter of 2011 due to: anticipated higher demand on account of the Yuletide and harvest seasons; a more stable macroeconomy; a broadly steady consumer sentiment; the continued inflows of remittances from Filipinos overseas; the reported higher level of business confidence relative to the previous quarter; and the full implementation of the PhP72 billion Disbursement Acceleration Program of the government. 

• Budget Deficit

• The Philippines recorded a budget deficit of P52.994 billion from January to September this year, about 80% lower than the P234.350-billion programmed for the period. 
• Year-on-year, revenues posted a 13.68% increase in the whole third quarter. Year-to-date revenues now reached the trillion-peso mark at P1.017 trillion as against last year’s P894.716 billion.
• The government’s catch-up spending continues to reflect on the fiscal numbers as September expenditures further sped up with interest payments continuously going down.
• As of the third quarter, government spending reached P1.017 trillion, 7.31% lower year-on-year. Much of the decrease however can be traced to interest payments, which declined 9.04%, while actual spending was only down by 6.85%.

• Inflation / Interest rates

• Average inflation for Q3 2011, went down to 4.4 percent from the previous quarter’s rate of 4.5 percent. From January to October 2011, inflation rate stood at 4.5 percent, within the 3.0 to 5.0 percent target for the year.
• The rise in the October inflation was due mainly to higher prices of most food items, notably vegetables and fish, which reflected the agricultural damages wrought by typhoons Pedring and Quiel. The upward adjustments in electricity and water rates also contributed to the higher inflation during the month. 
• The Monetary Board decided to maintain the BSP RRP and RP rates at 4.5 and 6.5 percent

• Foreign Direct Investments

• Total FDI approved in the third quarter of 2011 by the four major investment promotion agencies (BOI, CDC, PEZA and SBMA) amounted to PhP 25.0 billion, 32.0 percent higher than the PhP 19.0 billion committed in the same period last year.  Meanwhile, total approved FDI for the first nine months of 2011 amounted to PhP 87.3 billion, an increase of 9.9 percent from last year’s PhP 79.4 billion.  Top prospective investing countries include Japan, Korea, and the US.  
• Manufacturing remained as top recipient of FDI commitments as it stands to receive PhP 9.6 billion. Electricity, gas, steam and air conditioning came in second at PhP 5.1 billion, followed by real estate activities at PhP 4.8 billion.

• Net Portfolio Investments

• Transactions for the first 10 months of the year resulted in net inflows of US$3.4 billion, or growth of 37.3 percent from the US$2.5 billion recorded a year ago. Registered investments in PSE-listed securities amounted to US$7.4 billion, up by 9.6 percent compared to US$6.7 billion last year.
• Transactions for the month of October yielded net inflows of US$237 million, 58.6 percent higher than the US$150 million level for September 2011 but 78.2 percent lower than the US$1.1 billion recorded in 2010. 
• Singapore, the United Kingdom, the United States, Hong Kong, and Luxembourg were the top five investor countries for the month.
• Year-to-date, of all equities markets in the Asia-Pacific region, only the Philippines is up (+1.4% year-to-date). The PSE is the sixth-best performing exchange in the world so far in 2011.

• Remittances

• Remittances from overseas Filipinos coursed through banks remained robust in September 2011 at US$1.7 billion, registering an 8.4 percent year-on-year increment. The steady growth in remittance flows through September this year resulted in a cumulative year-on-year expansion of 7.1 percent to reach US$14.8 billion.
• For the nine-month period, the top ten country sources of remittances included the U.S., Canada, Saudi Arabia, the U.K., Japan, United Arab Emirates, Singapore, Italy, Germany and Norway. The remittance flows from these countries amounted to USD$12.5 billion, which represented 84.9 percent of total remittances reported by banks.
• Remittances from the UK for January-September 2011 increased by 7.52%

Jan – Sep 2011 (in USD)

2011                                       2010                                       Growth Rate %

707,688,000                         658,194,000                         7.52

• Gross International Reserves

• The country’s GIR as of end-October 2011 stood at US$75.8 billion, higher by US$0.6 billion compared to the end-September 2011 GIR. The appreciable build-up in the reserves level at end-October 2011 resulted mainly from the foreign exchange operations and income from investments abroad of the BSP as well as revaluation gains on the BSP’s gold holdings. 
• The preliminary end-October 2011 GIR could cover 11.2 months worth of imports of goods and payments of services and income.  It was also equivalent to 10.6 times the country’s short-term external debt based on original maturity and 6.4 times based on residual maturity

• Exports / Imports

• Total exports receipts for the January-to-September period declined by 3.1 percent to US$37.185 billion in 2011 from US$38.362 billion in the comparative nine-month period in 2010.
• Exports are now projected to grow by five percent and imports by 13 percent this year.
• UK Total

(Jan – Jun, in millions USD)

                     2011                                          2010

Export        Import     BOT              Export      Import    BOT             

Continue reading »]]> The Foreign & Commonwealth Office have just published a very good report about the impact of the global economic turbulence on SE Asia. It considers the position on all the countries in SE Asia, including The Philippines. The report starts by likening the Greek potential debt default and the global economic situation to two dogs.

“Imagine two dogs barking at SE Asia; either may bite. Greece’s potential debt default is akin to a Yorkshire terrier, fierce, noisy, and at the centre of attention. A nip hurts, but is not fatal. The risk of a Western double-dip is the Alsatian. Muzzled for a while, threatening once more, and a bigger threat to SE Asia.”

There are several performance charts and a comprehensive collection of statistics and assessments.

Read the full report HERE.