ExxonMobil unit allots $100 million more for South Sulu Sea project

MANILA, Philippines - ExxonMobil Exploration and Production Philippines B.V., an affiliate of the US-based oil and gas multinational, expects to spend another $100 million for the drilling of a third well at its Service Contract 56 in the South Sulu Sea.

The company said the drilling of the third well will be made over the next six months.

This developed as the Department of Energy (DOE) announced that ExxonMobil has completed drilling its second well in SC 56. The Banduria-1 well was drilled to a total depth of 4,370 meters.

With the completion of the Banduria-1 drilling, ExxonMobil has completed fourth exploration sub-phase commitment in SC-56 with the DOE. Drilling operations in the contract area started on Oct. 11, 2009.

The DOE said the first well, Dabakan-1, encountered gas.

“The two exploration wells have given us very useful data, which will now be analyzed by ExxonMobil. Additional studies are being conducted to evaluate the potential of the two wells and further appraisal plans, Energy Secretary Angelo T. Reyes said.”

ExxonMobil is the lead operator and owns 50 percent of SC 56, which also includes Mitra Energy (Philippines SC-56) Ltd. and BHP Billiton (International Exploration Pty Ltd.), each holding a 25-percent stake in the exploration project. 

SC 56 is part of the Philippine government’s efforts to encourage investments in the energy sector.

During this exploration period, all risk is borne by the contractors ExxonMobil, Mitra and BHP Billiton, at no cost to the Philippine government. 

The consortium has so far, spent $200 million for the drilling of the two wells in the area.

The DOE earlier said SC 56  contains about 750 million barrels of oil which can supply the domestic market for about seven years.