Kayangel State extended Palau Pacific Energy Inc. license to drill exploratory wells in Velasco Reef, the drilling license was supposed to have ended in May of this year. 

A resolution signed by the majority of the members of the Kayangel State legislature, ratifies the sixth amendment to the license agreement between the state and PPE for exploratory drillings.

The resolution was unclear on how long is the validity of the drilling.

The extension is pushed by former President Johnson Toribiong.

Starting in 2010, Toribiong advocated for oil exploration, hopeful that the oil will bring cheaper fuel revenues and jobs for the country.

While the company has obtained a license agreement with Kayangel State since 2002, no drillings have taken place.

According to the resolution adopted by the Kayangel State on May 13, 2021, the drilling has not commenced due to the “refusal of the appropriate agencies of the Government of the Republic of Palau to honor the requirements prescribed by the Palau Petroleum Act.”

It also stated that COVID-19 restrictions also caused “unavoidable delays” preventing the company from meeting the drilling deadline.

 Robin Jordan, PPE Inc. President in a letter to Kayangel officials said that studies commissioned by the company suggested that hydrocarbons have been generated “under the flanks of the Velasco area,” and the drilling will determine if oil and gas deposits are present in the Velasco Reef area of the state waters.

Former President Tommy Remengesau Jr. has expressed his opposition to the oil drilling due to the environmental impact it could cause on the reefs.

However, Mr. Jordan in his letter to the state officials said the company “respect and wish to preserve in our efforts with utmost attention to the environment and maintenance of the waters which provide for the welfare of all Palauans.” 

But according to environmentalists, offshore drilling for oil and gas threatens marine life and fossil fuels are the leading cause of climate change.

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