Philodrill sees P2B profit

MANILA, Philippines—Exploration firm The Philodrill Corp. is targeting to breach the P2-billion net income mark in two to three years’ time as it anticipates higher revenues from the doubling of oil production at the Galoc oil field in offshore Palawan.

Philodrill executive vice president Francisco Navarro said the second phase of development for the Galoc field would not only extend the life of the field to 2020, but also more than double the daily oil production to anywhere between 10,000 and 12,000 barrels of oil a day (bopd) from the current 5,000 bopd.

For the second leg of development, the members of the consortium operating Service Contract 14C-1, which operates the Galoc field, are investing a total of $188 million (about P7.5 billion). Of the amount, Philodrill is spending a little over 7 percent, or $13.16 million (or about P526 million).

“We have funding already available. We’re not borrowing. The drawing down of funds has already begun because the long lead items needed for the drilling are being acquired earlier. We expect drilling to start by the third quarter of next year,” Navarro said.

The Phase II development for the Galoc oil field involves the drilling of two subsea wells, which will be tied back to the existing floating production, storage and offloading (FPSO) facility. There is also an option to drill a third well on the Galoc North prospect following the completion of the two development wells.

For 2012, Navarro disclosed that Philodrill expected its net income to hit only P300 million to P400 million, about 60 percent lower than the P1.04 billion in net profit it posted in 2011. The decline was attributed largely to the shut-down of the Galoc oil field. Field operator Galoc Production Co. had shut down its operations at the Palawan oil field late last year for an upgrading work and was able to resume production only in the first week of April.

Philodrill, however, was expected to further increase its income next year to about P1 billion, which it might double by either 2014 or 2015 with the new wells at the Galoc already producing at optimum levels, Navarro added.

Apart from SC 14C-1, the publicly listed company also has interests in a number of petroleum service contracts: SC 14 (Nido, Matinloc, North Matinloc); SC 14C-2 (West Linapacan); SC 14 (Retention Block, Tara and Libro); SC 6A (Octon); SC 6B (Bonita); SC 41 (Sulu Sea); SC 53 (onshore Mindoro), and the Swan Block (deepwater in northwest Palawan).