PNOC-EDC bags $5.7-M drilling contract in Papua New Guinea

PNOC-Energy Development Corp. (EDC) bagged a 12-month drilling contract in Lihir Island, Papua New Guinea worth about $5.7 million, a company official announced yesterday.

EDC, a subsidiary of state-owned Philippine National Oil Co. (PNOC), has been tapped anew by Lihir Management Co. (LMC), the manager of the gold mining operations in Lihir Island, for the drilling of geothermal and dewatering wells in the island.

The new drilling contract is EDC’s fourth with LMC after completing its third contract in 2003.

For its first three contracts with LMC, EDC drilled a total of 28 geothermal wells, 10 dewatering wells, reworked three wells and deepened six wells.

It has operated for over three years in Lihir Island with zero lost-time incident, making the company the leader in safety performance over other international drilling companies contracted by LMC.

For the latest contract, EDC competed against Zenex Drilling of PNG and Century Drilling of Australia.

In early March 2005, LMC representatives contacted EDC for a rig inspection, a clear indication that the company will be engaged anew by LMC.

EDC is currently organizing the machinery, equipment, materials and supplies necessary to complete LMC’s drilling rig requirement for its 2005-2006 drilling program.

"EDC’s drilling services continue to be a profitable venture for the company. Our annual revenue comparison shows an average 10-percent yearly increase in our drilling income. Between 1999 and 2003, EDC earned almost P1 billion in revenues from the three consecutive LMC contracts. It translates to nearly P400 million in net profit for EDC just from drilling contracts alone," EDC president Paul Aquino said.

The firm remains a global player in the drilling industry. It started exporting its drilling services in 1997 for an oil and gas drilling contract in Indonesia.

It has also sent rigs and deployed drilling consultants and rig maintenance specialists to Indonesia and Papua New Guinea.

In 2003, it was contracted by the Bangladesh Petroleum and Exploration Co. for drilling rig rehabilitation.

In the Philippines, EDC counts Philippine Geothermal, Inc. among its major clients.

EDC, the country’s largest geothermal company, owns and operates seven drilling rigs. Rig 9, the rig used in Lihir, has already received two safety recognition from the International Association of Drilling Contractors (IADC) – Accident Statistics Program (ASP). It received its first safety recognition during its first two years of international operations.