Total takeover of Sulu Sea contract expected in 2013

Total E&P Philippines BV may soon become the operator of Service Contract 56 off Sulu Sea, once the acquisition of additional 3D seismic data within prospective oil and gas blocks is completed.

Total’s partner in SC 56, Malaysia-based Mitra Energy Ltd., commissioned the 540 square kilometer seismic program, which is being acquired by WesternGeco using M/V Western Patriot.

The seismic program, which began last January 27, may be completed within a month, assuming that no technical problems will be encountered, according to the Department of Energy.

The agency also estimated the cost of the seismic program to range between $3 million and $5 million.

At present, SC 56 is operated by Mitra Energy with a 25 percent stake, while Total E&P Philippine B.V. holds the remaining 75 percent interest. The two companies earlier agreed that after the data acquisition, the operatorship will be transferred to Total E&P for the drilling operations.

Total earlier said that with its acquisition of a 75 percent stake in Sulu Sea, it will be able to pursue its strategy to further expand its acreage in significant potential plays in new exploration areas, notably in deep offshore Asia Pacific.

The original consortium (led then by ExxonMobil) had drilled four exploration wells within the Sandakan Basin worth some $400 million, over a span of only two years. Two significant gas discoveries were found in drilling the Dabakan-1 and Palandag-1A wells and a minor discovery at Babendil-1.

ExxonMobil, however, decided to withdraw from SC 56, as it deemed the resource in the block to be of “noncommercial quantities.”

However, previous estimates made by the DOE placed the potential oil resource within SC 56 at roughly 750 million barrels, enough to provide petroleum products for seven years.