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SC 51 work scrubbed due to safety issues

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SC 51 work scrubbed due to safety issues

MANILA, Philippines—Otto Energy Ltd. of Australia is abandoning Service Contract 51 in Leyte, citing safety concerns.

Duhat-2 should have been the energy firm’s third operated well this year alongside the two development wells for Galoc Phase II.

The company said in a regulatory filing that it decided to plug the Duhat-2 well in SC 51, considering it unsafe due to high pressure water leaks and weak rock beds.

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“Standard industry safety practice was followed to shut in the well using heavyweight mud and a cement plug,” Otto Energy said.

According to Matthew Allen, Otto Energy CEO, the Duhat-2 well presented a series of “very unexpected and potentially dangerous” challenges to the drilling team.

In addition to safety concerns, Allen said, Otto subsidiary Otto Energy Investments Ltd. (OEIL) decided to call off work after it reviewed the prospects of the SC 51 North block.

“OEIL sees no further defined exploration targets within [SC 51],” Allen said.

As early as July 2013, OEIL said it wanted to withdraw from the Duhat-2 exploration well as high-pressure leaks presented operational and environmental risks.

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TAGS: Business, Energy, Leyte, oil and gas-upstream activities, oil exploration, Otto Energy, Philippines, safety
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