Australian firm Gas2Grid Ltd. is eyeing to drill a new well at the Nuevo Malolos-1 oil field in the Visayas, but the move still depends on availability of funds, the company announced Tuesday.
“The company, subject to availability of funding, would like to drill a new well to test the known oil bearing reservoirs,” Gas2Grid said in a statement.
Gas2Grid is also considering deepening the Nuevo Malolos-1 well to the two known oil bearing reservoirs tested in Malolos-1 well, again, subject to funding availability.
Gas2Grid continues to look for a partner to fund the full appraisal and development of the Malolos oil field.
“Farm-out presentations are continuing, and the company is now pitching farm-in terms that reflect the current lower oil price in order to achieve a farm-out,” the company said.
The firm remains optimistic that the Malolos oil field represents an attractive investment opportunity despite the recent oil price drop.
“This could result in very low development and operating costs, which will leave a healthy profit margin, even at the current low price,” it said.
The oil field, which is under service contract 44, has 20.4 million barrel best estimate of good quality, low-sulphur crude oil that is located onshore Cebu.
The Philippines’ excellent fiscal terms are also seen boding well for the project.
The company’s service contract, issued in 2004, covers a 750-square-kilometer area in Central Cebu, where oil discoveries exist.
The firm also said the Department of Energy (DOE) has approved a two-year technical moratorium or until January 2017 for service contract 44.
This, according to Gas2Grid, would give more time for further studies and establishment of appropriate technology towards a successful oil production.
The firm said the moratorium aims to find the technology that would maximize sustainable oil production, “that is successful, will lead to full oil field appraisal/development.”
The company is finalizing technical work being conducted with industry experts.
“This aims to analyze all available technical data to identify the completion technology that will minimize sand and clay production to avert production blockage and maximize oil production rates,” it said.
Gas2Grid’s core business is the exploration for and development of conventional oil and gas onshore Cebu, Aquitaine Basin in southwest France, and the Canning Basin in Australia.