MANILA, Philippines - Australian firm Otto Energy has been named the “preferred bidder†for Area 7 under the latest Philippine Energy Contracting Round.
The company said it plans to invest $500 million to reprocess a seismic study in the offshore block located in the southern part of Mindoro, within an initial 18-month period.
In an announcement, Otto Energy said the final award decision would be subject to the execution of the final form of the Service Contract and other documentation requirements.
With this development, Otto Energy said the awarding of Area 7 adds “new potential for the company’s high impact exploration in Southeast Asia and East Africa.
Area 7 covers around 8,440 km2 with water depths ranging from 100 to 1,300 meters. There is an existing 2D seismic data set of over 3,000 kilometres covering the block.
“The petroleum play types identified in Area 7 are reef build-ups, fault blocks and anticlines. The reservoir intervals are early miocene to pliocene carbonates and early to late miocene carbonates and clastics. Source rocks are coaly and organic-rich claystones of Eocene to Middle Miocene,†Otto Energy said.
Oil has been discovered with an extended production test conducted in 1994 at the Maniguin wells near the block. The occurrence of oil seepages in the Mindoro Island region also confirms the presence of an active petroleum system in the area, Otto Energy also said.
Otto Energy, which operates the Galoc field and majority shareholder of Service Contract No. 14C earlier announced that the consortium made its final investment decision to proceed with the second phase of the Galoc field development.
The company also said that implementing the second phase of Galoc project was consistent with the company’s strategy of building an integrated petroleum company, generating a sustained flow of drilling events, focusing on Southeast Asia and onshore East Africa.
Aside from the Galoc project in Palawan, Otto Energy also hopes to secure contracts this year for drilling Duhat-2 exploration well, onshore Leyte in mid-2013.
Duhat-2 well, also known as Service Contract 51 is operated by a consortium led by Otto Energy.
Otto Energy owns and operates 80 percent of SC 51. Its partners in the consortium are Trans-Asia Oil and Energy Development Corp., Alcorn Gold Resources Corp. and Petro-energy Resources Corp.
The company also expects to complete the technical evaluation of new 3D covered data in Service Contract 69 in offshore Visayas for oil and gas prospects.