RAZON-LED PRIME Energy Resources Development B.V. has awarded a contract to US-based company OneSubsea for equipment supply in the Malampaya fields.

The contracts cover wellheads, control equipment, and subsea production systems, the company said in a statement on Tuesday.

The equipment, which will be supplied by the end of the year, will support drilling for Malampaya Phase 4, targeting two new deep water wells.

Drilling is planned for 2025 with the aim to deliver new gas by 2026.

OneSubsea is a joint venture backed by SLB, Aker Solutions, and Subsea7, which delivers integrated solutions, products, systems, and services for the subsea oil and gas market.

Prime Energy, a subsidiary of Prime Infra, holds a 45% operating stake in the Malampaya consortium.

The Malampaya consortium is composed of Prime Energy, Udenna Group’s UC38 LLC, and the state-owned Philippine National Oil Company-Exploration Corp.

The company also plans to drill a third well, called “Bagong Pag-asa,” as part of the 2025 drilling campaign, subject to partner approvals.

Prime Energy said that the exploration will determine the presence of oil and gas in a structure approximately 15 kilometers from Malampaya, which is aimed at further extending the flow of indigenous gas.

“A complex project of this nature has not been done for more than a decade in the Philippines, as Service Contract No. 38 (SC38) has only been renewed in April 2023,” Prime Energy said.

It said that the “renewed cycle of exploration and development activities by SC38” calls for “a temporary recalibration” of Malampaya pricing to ensure continued operations.

Malampaya has remitted over $13.5 billion to the government from the start of its commercial operations in 2001, it said.

“This pricing formula is set to decrease over the next 15-year SC38 Contract Renewal term, keeping Malampaya gas price competitive and more importantly, more stable than alternative fuels like imported spot LNG (liquefied natural gas),” the company said. — Sheldeen Joy Talavera