MANILA, Philippines - Total Philippines, the local arm of the French energy giant, is further assessing the potential of its offshore block in the Sulu Sea after a six-year extension granted by the Department of Energy (DOE), a ranking official said.
“In October 2014, we have taken operatorship and now we are studying the development of the first well. We have obtained from the Department of Energy an extension until Aug. 31, 2020. We have more time to assess the potential of the site,” said Total general manager Fabien Colmet Daage.
According to Daage, Total is unfazed despite the probability of not finding anything is higher than the probability of finding gas reserves.
“We are not discouraged,” he said.
Daage said Total can market the reserves as liquefied natural gas (LNG) in the event of a discovery.
In 2012, Total announced the signing of a farm out agreement with Mitra Energy based in Kuala Lumpur, Malaysia, to acquire a 75 percent interest in the offshore Block SC 56, located in the Sulu Sea.
Mitra, for its part, earlier bought its stake from ExxonMobil Exploration and Production Philippines B.V. (50 percent) and BHP Billiton International Exploration Pty Ltd (25 percent).
This was after ExxonMobil withdrew its 50 percent stake in SC 56 after finding “non-commercial quantities of gas” in the South Sulu Sea.
From 2010 to 2011, ExxonMobil drilled four wells and invested around $400 million before it declared SC 56, which covered an area of 8,200 square kilometers including the gas-rich Sandakan Basin, as non-commercial.
In an earlier report, Mitra said based on previous drillings, SC 56 is estimated to contain contingent resource of between 42 million barrels and 56 million barrels of oil. Additional prospective resources in undrilled prospects and leads are estimated at 628 million barrels of oil to 1.127 billion barrels of oil.