MANILA, Philippines–Australian firm Nido Petroleum Ltd. has secured a debt facility of up to $30 million from Standard Bank Plc to help fund the planned Phase II development for the Galoc oil field off Palawan.
In a regulatory filing, Nido Petroleum managing director Phil Byrne reported that the senior secured debt facility would be made available to the company in two tranches.
The first installment of up to a maximum of $15 million will be made available prior to the final investment decision (FID), which is expected within the third quarter this year, while the second tranche of another $15 million can be made available after the investment decision and subject to approvals and other terms of the facility.
“We are very pleased to secure this funding for the Galoc Phase II development at attractive terms with Standard Bank, specially given the current uncertain market conditions for financing,” Byrne said.
“Now with a significant portion of our share of the Phase II development funding in place, we look forward to reaching the FID point for the Phase II development. This development will extend the existing production life of the field and deliver additional cash flow and value to Nido in the coming years,” he added.
Nido Petroleum, which holds a 22.879-percent working interest in Service Contract 14C, said the Phase II development would see the drilling of two additional production wells next year, with the first oil expected to be drawn by the second half of 2013.
Based on the resource estimates of the SC 14C operator Galoc Production Co. WLL, the two new wells are expected to contain as much as nine million barrels of oil and extend the life of the field up to 2018.
The Galoc joint venture has already pre-invested in the required infrastructure, including wellheads, flowlines and umbilical lines to ensure the drilling of wells in the northern portion of the Galoc structure to boost production and access undeveloped reserves.
As of end-June this year, production at the Galoc oil field has exceeded nine million barrels, depleting more than 62 percent of the 14.44 million barrels in its projected reserves since it began production in October 2008.