Marcos sees ‘distinct possibility’ of joint oil and gas deal with China, but offers no timetable

Philippine President Ferdinand Marcos Jr. sees a "distinct possibility" for a joint oil and gas exploration deal with China in the South China Sea, though he offered no specific timetable. He explained that defining the terms of reference for such a venture, whether government-to-government or commercial, is the current focus of discussions.

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Like any joint venture, G2G (government-to-government), or if it is purely commercial, you have to define between yourselves, between the parties, the terms of reference. That’s what we are doing now, and we’re working through them, and we’re making progress.

Marcos highlighted the urgency of finding new fuel sources for the Philippines, particularly in light of the oil supply shock caused by the Iran war, which has led to a national energy emergency. He expressed that all parties involved desire the venture's success, but the timeline remains dependent on the ongoing discussions.

Previous attempts at such cooperation have faced hurdles. A 2018 memorandum on oil and gas cooperation was scrapped in 2022 due to unresolved sovereignty issues and the Philippine Constitution's mandate for state control over natural resources. Despite an agreement to revive talks in 2023, no concrete results have emerged. Joint development of Reed Bank, located within the Philippines' Exclusive Economic Zone but also claimed by Beijing, has been proposed and abandoned multiple times since 2018. This area is believed to hold significant gas reserves that could help offset the depletion of the Philippines' Malampaya field, a crucial supplier for Luzon's electricity.

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We have to find new ways.

Separately, Marcos defended a provisional understanding with China regarding resupply missions to the BRP Sierra Madre, a grounded vessel serving as the Philippines' most remote outpost in the South China Sea, an area marked by competing claims and tense encounters.

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That depends on how the discussions go. I think the sense that I get is that all parties involved want it to succeed. I could not give you a definite timetable, I’m afraid.