Otto Energy withdraws from E Visayas oil contract

MANILA, Philippines - Otto Energy Ltd., an oil and gas company listed at the Australian Stock Exchange, has opted to withdraw from Service Contract 69 in Eastern Visayas.

Otto Energy chief executive officer Gregor McNab said the company decided to exit the project to concentrate on other opportunities with more potential.

“The decision to exit SC 69 is part of our disciplined approach of constantly reviewing our portfolio to ensure we invest in the highest potential opportunities,” he said.

Trans-Asia Oil and Energy Development Corp., the energy arm of the Phinma Group, which is also part of the project, also disclosed the withdrawal of Otto Energy from SC 69.

With Otto’s withdrawal from SC 69, Trans-Asia  Petroleum Corp. and Frontier Gasfields Ptg Ltd. Remain as proponents of the service contract.

Otto Energy, TA Petroleum and Frontier hold 79 percent, six percent and 15 percent participating interest in SC 69, respectively.

 TA Petroleum has earlier sought a six-month extension of the Oct. 7 deadline to start the next exploration sub-phase.

“TA Petroleum and Frontier subsequently jointly requested the Department of Energy a six-month extension of the Oct. 7, 2013 deadline to elect to enter the next exploration sub-phase,” Trans-Asia  oil said.

Based on the original deadline, the consortium is supposed to drill one exploration well from Nov. 7, 2013 to Nov. 7, 2014 and drill another exploration from Nov. 7, 2014 to Nov. 7, 2015.

Despite its withdrawal from SC 69, Otto Energy said it would continue to invest in its high quality assets in the Philippines and East Africa.

In the Philippines, its other projects includes the development of the Galoc field which is nearing completion, as well as exploration drilling in SC 55.