by Myrna Velasco
from Manila Bulletin, 18 December 2015
The board of directors of listed firm Basic Energy Corporation has approved in principle its tie-up with another local firm DESCO, Inc. for a geothermal venture in the Bicol region.
The project delves with prospective exploration and development of the Iriga geothermal project of which service contract was originally awarded by the government to Basic Energy.
In a statement to the media, Basic Energy has noted that board approval had been arrived at in their meeting last December 16.
Under the proposed deal, it was emphasized that “DESCO will be taking up an 80-percent equity position in the project subject to the formal signing of farm-in agreement and deed of assignment.”
Basic Energy further indicated that subsequent approval of the Department of Energy (DOE), being the State counter-party in the geothermal service pact, must also be secured.
Once the details of the partnership are firmed up, Basic Energy said “DESCO will undertake a geophysical survey and all other steps required to bring the project to drilling.” The Iriga geothermal service contract was awarded by the energy department to Basic Energy on February 26, 2013.
The original project-holder has stressed that DESCO’s entry purportedly manifests “the bullishness of the project” given that before its plunge into that equity take, it had undertaken extensive review on the prospect.
DESCO’s line of business is on provision of support services to exploration and development of oil and gas as well as geothermal ventures.
The Iriga geothermal prospect straddles Mount Asog – it is classified as “stratovolcano” proximate to the Lake Buhi in Southern Luzon.