Otto Energy Ltd. is set to abandon the Hawkeye-1 exploration well off Palawan as resources failed to meet expectations.
In a project update, Otto said Hawkeye-1 had been drilled to the planned total depth of 2,920 meters.
The top reservoir was intersected at 2,710 meters. Hydrocarbons were logged between 2,710 and 2,737 meters. Below 2,737 meters, water was inferred from log observations.
Hawkeye-1 will now be plugged and abandoned, Otto said.
The Australian company said the drilling program was executed smoothly, ahead of schedule, and ahead of budget.
Otto is fully carried on the cost of drilling Hawkeye-1.
Managing director and CEO Matthew Allen said, “The Hawkeye-1 exploration well has proven the existence of hydrocarbons in SC55. The hydrocarbon size discovered is however at the very low end of expectations and is not economic to develop.”
Otto will now incorporate the results from the well into the company’s studies of the other prospects, including Cinco, in the license which potentially share the same charge source, he said.
While the result at Hawkeye is “disappointing,” Otto is still a well-funded explorer with high impact exploration activity in the next 12 months, he said.
Otto is preparing for the upcoming exploration programs in its Alaskan and Tanzania assets.
Otto is an Australian Securities Exchange-listed oil and gas company with a strategy to grow an integrated petroleum business through exploration.
Focused on conventional oil plays in proven petroleum areas, Otto used to operate the producing Galoc oil field in the Philippines.