Australian oil and gas explorer and producer Otto Energy Ltd. (Otto) is set to start drilling for oil at Petroleum Service Contract (SC) 55 in offshore Palawan in a month’s time.
Otto has already issued a formal notice for mobilization of the Maersk Venturer drill ship to the Hawkeye-1 exploration well location.
The drill ship Maersk Venturer, which is currently in Labuan, Malaysia, is expected to arrive at the well location by the end of the month, with actual drilling to commence one to two days thereafter.
“The drilling operations will commence upon arrival of the rig on location,” Otto said in a statement.
Otto has already notified Palawan55 Exploration & Production Corporation (Palawan55), a subsidiary of Trans-Asia Petroleum Corporation, about the drilling work.
Otto previously announced the drilling would start in July.
Palawan55 has 6.82 percent participating interest in SC 55 and continues to field interest regarding potential Hawkeye-1 well farm-in opportunities.
It noted a reported offer by Pryce Gases Inc (Pryce), an LPG (liquefied petroleum gas) distributor and a subsidiary of Pryce Corporation, to farm-in for a 10 percent working interest in SC55 and the Hawkeye-1 exploration well.
Otto said the negotiations are incomplete and the current offer by Pryce is not capable of acceptance.
Otto is fully funded for the drilling of Hawkeye -1 following a successful farm down process and $24.5 million funding.
Otto holds a 78.18 percent interest as operator of SC55, with Red Emperor holding 15 percent.
As for PNOC Exploration Company’s (PNOC-EC) expression of interest to farm-in for a 15 percent interest in SC55, Otto said the offer is still valid but it will still need approval from the Office of the President which is required before such a transaction can be finalized.
Otto said SC55, located in the southwest Palawan Basin, contains a number of distinct exploration play types that provide material opportunities including carbonate gas/condensate trend that has the potential for an oil charge.
It added that SC55 is not located in disputed territory.
It said the Hawkeye prospect was identified on 2D seismic originally acquired by Otto in 2007 and further defined with the 600 km2 3D seismic acquisition in late 2009.