AUSTRALIA-BASED Nido Petroleum Ltd. (Nido) has announced its plans to expand its drilling program in Service Contract 54 (SC54) by accelerating its shallow-water strategy.

In a statement, Nido said the company and its joint-venture partner Kairiki Energy Ltd. (Kairiki) have approved a budget to drill at least two shallow-water wells with a jack-up rig at the end of the year and followed by the drilling of the Gindara prospect in 2009.

“The majority of previous drilling in the Palawan Basin has focused on the Nido pinnacle reef play—this is the proven play type in the basin where historical drilling on 2D seismic has demonstrated greater than a 50-percent success rate,” Joanne Williams, Nido deputy managing director, said.

She added that the shallow-water area of SC54 boasts of more than 20 pinnacle-reef discoveries and prospects with potential oil in place ranging from 2 million to 20 million barrels each.

Williams said with the modern 3D seismic now covering the targeted area, these drilling opportunities are considered very low risk.

“Current record oil prices of over Australian$120 per barrel provide the perfect environment for the evaluation of this area. While each individual drilling target is of moderate size, the sheer number of targets, together with their very low risk, represents a material opportunity for near-term cash- flow potential,” said Williams.

She further revealed that Nido intends to kick off the evaluation of the shallow-water area with the drilling of at least two wells.

With the acceleration of the shallow-water program, according to Jon Pattillo, Nido exploration head, they now also plan to increase its SC54 drilling program from one well at Gindara to three wells.

He added that the procurement of long lead items is underway and we are currently in the final stages of negotiation for two rigs to drill the three-well program.

“We expect to contract a jack-up rig to drill the two shallow-water wells toward the end of 2008 and a semi-submersible rig to drill the deeper- water Gindara exploration well in mid-2009,” Pattillo said.

Securing rigs in the current environment has been a challenge, but we look forward to concluding contracts on both rigs within weeks,” he added.

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AUSTRALIA-BASED Nido Petroleum Ltd. (Nido) has announced its plans to expand its drilling program in Service Contract 54 (SC54) by accelerating its shallow-water strategy.

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