Nido Petroleum bares new oil, gas find

MANILA, Philippines – Australian oil exploration firm Nido Petroleum Ltd. said yesterday it has discovered another potentially major oil and gas deposit in Northwest Palawan.

In a report, Nido said it found oil and gas potential in Service Contract 58 (West Calamian block) in Northwest Palawan, which is adjacent to the Malampaya gas field.

Nido said a deepwater seabed coring program completed in April showed “strongest evidence for light hydrocarbon micro-seepage which corresponds to the location of the large Butanding, Balyena and Balyena East Prospects within SC 58.”

“The majority of core data indicates widespread micro-seepage of liquid hydrocarbons across SC 58 based on preliminary gas chromatography results,” the company said in a report submitted to the Australian Stock Exchange.

SC 58 is located in the deep waters of Northwest Palawan covering an area of 13,440 square kilometers.

Nido head of exploration Jon Pattillo said “the widespread distribution of liquid hydrocarbon micro-seepage implies the presence of an extensive and active oil and gas-prone source system across the most prospective sector of deepwater SC 58.”

“The core data has successfully provided the SC 58 joint venture with evidence for direct hydrocarbon indications within deepwater SC 58, where no wells have been drilled to date. These preliminary results substantially reduce source and charge risk not only with respect to the large Balyena, Butanding and Balyena East Prospects identified by Nido’s 2D and 3D seismic campaigns but the entire deepwater fairway across SC 58,” he said.

Nido said it found “very encouraging and highlighted the potential that exists in the deepwater SC 58 permit where Nido partnered with PNOC Exploration Corp.”

“Nido has estimated that the structures in this permit have the potential to contain over five billion barrels of unrisked oil in place (most likely),” it said.

According to Nido, the results and implications of the coring data will be fully integrated into the SC 58 joint venture’s subsurface interpretation of the block allowing further ranking of the prospect and leads portfolio and future selection of drilling site candidates.

Nido earlier reported that it hopes to start drilling for the SC 58 prospect by 2012.

Nido president and CEO Jocot de Dios, for his part, said the positive preliminary result of the seabed coring campaign corroborated the inclusion of the Balyena prospect in SC 58 as part of Nido’s five-well drilling campaign.

“This further supports the investment that Nido has made in the block since its award in 2007 and will be invaluable in the company’s evaluation of our top-ranked prospects,” he said.

At present, Nido is a dominant player in the Northwest Palawan basin across all water depths from the shallow water areas that include its two producing oil fields at Galoc and Tindalo oil fields.

Meanwhile, Nido also reported that that first crude oil cargo from the Tindalo oil field has been successfully offloaded.

It said a total of 194,336 barrels of crude oil has been offloaded from the FSO Tove Knutsen into the offtake tanker MT Amba Bhavanee which has taken the crude onboard.

The MT Amba Bhavanee, Nido said, will sail to South Korea over the next several days to deliver the cargo.

The oil firm said the sale of the first cargo will deliver over $14 million in gross revenue to the Tindalo joint venture.