EDC shelves Chile drilling

MANILA, Philippines - Energy Development Corp. (EDC) has temporary called off drilling activities at the Mariposa project in Chile this month due to the challenging environment brought about by the fall of global oil prices.

In a statement, EDC said it has decided to postpone the three-well drilling campaign for the Mariposa project originally scheduled for mid-October.

This is “in the light of the challenging project economics resulting from the recent fall in prices of competing fossil fuels,” the firm said.

However, the Lopez-led firm pointed out it remains committed to developing the Mariposa project and optimistic on the long-term prospects of the Chilean electricity market.

“EDC continues to pursue development activities with greater focus, including conducting further environmental and technical studies for the steamfield, power plant, and transmission line interconnection,” it said.

“To advance the development of Mariposa, EDC will prioritize investing in technical studies for the front-end engineering design (FEED) for the steam field, power plant and for the transmission line connection, as well as proceed with the Environmental Impact Assessment (EIA) for the project,” it added.

The company also noted efforts will be undertaken to identify potential customers and test the pricing levels at which they are willing to enter into long-term power off-take agreements.  EDC is also negotiating with the Inter-American Development Bank (IDB) to secure funding support under the exploration risk mitigation program administered by the bank.