SPEX kicks off drilling in new Northwest Palawan well

MANILA, Philippines - Shell Philippines Exploration B.V. (Spex), a member of the Royal Dutch Shell Group, recently kicked off drilling activities at its new exploratory well in Northwest Palawan, industry sources said.

According to sources, Spex started drilling operations in the Camago-2 well offshore Northwest Palawan under Service Contract 38 on April 25.

SC 38 is currently being operated by Spex along with Chevron-Texaco and PNOC-Exploration Corp. (PNOC-EC).

It was learned that the Spex consortium utilized the semi-submersible drilling rig Atwood Falcon which was towed from Buah Naga-A in offshore Miri in Sarawak, Malaysia. 

Pilipinas Shell Petroleum Corp. country chairman Edgar Chua earlier confirmed plans to drill additional wells at SC 38. He said they are prepared to allot about $80 million for the drilling of a new well under SC 38.

“There is an initial $80 million committed investment. We are investing to determine the volume of reserves,” Chua said.

He said if the drilling yields positive results, the consortium may invest for more drilling activities in the area.

The Malampaya gas field called Camago was discovered in 1989. So far it is the largest gas find in the country.

Spex acquired a 50 percent participating interest in SC 38 in 1990. The consortium discovered the Malampaya gas field two years later. At that time, Spex was able to drill five wells to determine the amount of gas available in Malampaya. The then drillings confirmed the presence of about 2.7 trillion cubic feet of natural gas reserves and 85 million barrels of condensate, located some 3,000 meters below sea level. 

The gas field’s operations was declared commercial in 1998 and in 2001 the Malampaya deep water gas-to-power project was inaugurated. 

The deep water gas-to-power project with investments of $4.5 billion has helped to cut the country’s dependence on oil imports by between 20 and 30 percent.