PearlOil gives up stake in Ragay Gulf contract

PearlOil (Ragay) Ltd. and partner PNOC Exploration Corp. have relinquished their entire interest in Service Contract 43, as the resource potential in the petroleum prospect was deemed not viable.

In a letter to the Department of Energy (DoE), Pearl regional VP for exploration Paul Bransden said that as of the end of 2011, the joint venture will be surrendering the entire contract area and terminating the deal in accordance with Sections 5.6 and 6.3 of the service contract.

“We note that to date, PearlOil, and partner, PNOC-EC, have satisfied all our service contract work commitments in this sub phase, thus relieving us of any more work and expenditure commitments in the future,” Bransden said.

“We are taking this step because we would like to optimize the risk allocation of our exploration profile more efficiently. Also, based on the latest geological and geophysical analysis done on the block in 2011, the exploration prospects identified in SC 43 no longer match the technical themes which the SC 43 consortium wishes to pursue,” he added.

Bransden, however, told the DoE that the company remained open to working again with the DoE and the Philippine government on other opportunities for petroleum exploration and development that may arise in the future.

The SC 43 license was awarded on Jan. 14, 2004, originally to PNOC-EC, Premier Oil and Pearl Oil Ltd. and was supposed to expire on Jan. 14, 2012. After Premier Oil relinquished its interest, PNOC-EC held a 19-percent participating interest in SC 43 while Pearl Oil (Ragay) Ltd,, operator of the service contract, held the remaining 81 percent.

The block is located in the Ragay Gulf and partly onshore of the Bondoc Peninsula, covering a total area of 5,280 square kilometers. During the service contract period, the joint venture managed to drill one exploration well and acquired 476 kilometers of 2D data, 274 square kilometers of 3D seismic data and 1,925 km. of aeromagnetic/gravity data.

It has also completed the reprocessing of 345 km 2D seismic data. PNOC-EC, on behalf of the joint venture, earlier conducted geological fieldworks in Bondoc Peninsula, Marinduque and Burias Island to study outcrop analogs of the source and reservoir rocks in the area.