Otto turns to Maersk for $35M well drill
MANILA, Philippines–Otto Energy Ltd. will spend up to $35 million for the drilling of a gas-oil well off Palawan and has contracted Maersk Venturer’s deep water ship for the job.
Hoping to discover a resource that can replace the existing Malampaya gas operation, which may be depleted in 2024, Otto will delve deeper into the Hawkeye-1 prospect in southwest Palawan from July 17 to August 15.
The initial well may cost up to $35 million, Otto said in a regulatory filing in Australia.
“Should the well encounter hydrocarbons, more detailed evaluation, including well logging, will be undertaken,” Otto said, adding that overall cost could increase by up to $3 million.
The company also said that it was fully funded for such a situation.
The Australian exploration firm said that it received an expression of interest from the Philippine National Oil Co.—Exploration Co. for a 15-percent interest in the undertaking.
Both parties are currently awaiting the required approval from the Office of the President before it can close this transaction, Otto said.
The southwest Palawan prospect, part of Service Contract 55, has the potential to be as viable as, if not more than, the operating Malampaya gas field, according to Otto.
Malampaya is one of the biggest and most significant industrial endeavors in Philippine history. Since it began producing natural gas in October 2001, the Malampaya gas field has been supplying cleaner power to Luzon, helping reduce oil imports, and remitting taxes and royalties to the Philippine government.
“Final preparations for the drilling of the Hawkeye-1 exploration well are considerably advanced. This is a very exciting time for Otto as we undertake this important and potentially high impact drilling event on behalf of the Philippines’ Department of Energy and our joint venture partners,” company CEO Matthew Allen said.
According to Otto Energy director Rufino B. Bomasang, the Australian firm will welcome more partners to its Service Contract 55, which hosts Hawkeye-1 as it approaches drilling.
“Given that Malampaya is projected to be depleted in the next decade, looking for the next Malampaya should be a national priority,” Bomasang said.–Riza T. Olchondra
