For more than 30 years, the Philippines has watched in frustration as neighbors Indonesia and Malaysia have reaped riches from their oil.

One well after another came up empty, prompting oil companies to move on to better prospects elsewhere. But a 1991 oil strike by the Anglo-Dutch Shell Group and Occidental Petroleum changed the picture dramatically.Exploration companies are due to drill 20 wells next year, compared with fewer than 10 in 1993.

Despite a record of failures, the mood among oil executives going into 1994 is guardedly optimistic, and they say interest in the Philippines is higher than at any time since the 1970s.

The hope is of a find to match the Malampaya field off Palawan island, which industry analysts believe may yield up to 300 million barrels of oil.

"I may be dreaming, but it's a dream with a basis that we can discover two or three more Malampayas," Rufino Bomasang, Energy Department undersecretary, said in an interview at a recent energy conference in Manila.

"Because if we do, we will be 100 percent self-sufficient in oil. So we are confident, and we are hopeful."

Others are not so sure.

"I would like to warn against some over-optimism," said Reinier Willems, chief executive of Shell subsidiary Pilipinas Shell.

An exploratory well can cost up to $20 million with no guarantee oil will be found despite all the survey and seismic work done by companies in a supposedly promising area, he said.

Water seepage problems have led to production cuts in Alcorn's West Linapacan field, near Palawan. Industry officials blamed the Alcorn-led consortium for pushing production of the well too hard. Alcorn's headquarters are in Houston.

"We suspect that's what happened; the fact is everybody is disappointed by Linapacan," a senior oil company official said.

Current oil production, at about 15,000 barrels a day, is only a fraction of national consumption of more than 220,000 b/d.

The government predicts that, by the year 2000, the Philippines may reduce its dependence on imported oil to 33 percent of its total energy needs

from 65 percent, once Malampaya comes on stream in two to three years.

Mr. Bomasang said five shallow wells will be drilled in the Philippines next year, aside from 14 already scheduled, most of which are offshore.

Aspirants include Atlantic-Richfield Co., which will drill for oil in the Sulu Sea near southern Mindanao island, and Occidental, which will explore an area off Palawan.

Alfredo Ramos, president of the Petroleum Association of the Philippines and chief executive of Philo- drill Corp., said local oil companies needed to merge and pool resources to explore remote areas.

He urged the government to give incentives for deep-sea drilling and help formulate rules for development of gas deposits.

Shell recently opened discussions with Manila on building a gas pipeline over 1,000 kilometers (600 miles) from Malampaya to Luzon island.

Most drilling has been concentrated in the Palawan basin, the only proven oil province in the country.

But energy officials said promising basins for exploration include the remote and rebel-infested Cagayan region and Bondoc peninsula on Luzon island and the northern half of troubled Mindanao, where bandits proliferate.