NIDO Petroleum Ltd. has committed—along with Philippine National Oil Co.-Exploration Corp. (PNOC-EC)—to drill a well in Service Contract (SC) 63 area in northwest Palawan.
SC 63 is at the northeast end of the tertiary-aged offshore fold and thrust belt, which is a prolific hydrocarbon province. The belt extends from Brunei through Sabah, Malaysia and into the southern Palawan basin.
In his presentation posted in the company website, chairman William Bloking said the second well could be drilled as early as December 2011.
He, however, said it is more likely that drilling will take place within the first few months of 2012.
“Success in any one of these wells will certainly be transformational for Nido. That said, we must also bear in mind that these are exploration prospects and, whilst technically quite robust, outcomes are still subject to risk. That is why it’s so important to drill a statistically significant exploration program—not a one well wonder,” Bloking said.
Jocot de Dios, Nido president and chief executive, said a number of exploration companies continue to express interest to farm-in to the project. In the meantime, de Dios said Nido is planning for the drilling of SC 63 well within December this year up to March 2012.
Early this month, Nido said it is set to begin the second sub-phase of development of its SC 63 exploration program. The second sub-phase of SC 63, which is set to begin on May 24, carries a one well commitment to be drilled not later than November 24, 2012 and represents the next prospect in Nido’s five well exploration program.
Nido said they will finalize the selection of a drilling target; seek to confirm rig contracts and plan a drilling schedule.
During the previous sub-phase, Nido said subsurface work in SC 63 focused on the acquisition, processing and interpretation of the 754 square-kilometer (km)”kawayan” three-dimensional (3D) seismic survey over the southern sector of the block, around the Aboabo A-1X gas discovery (Phillips 1980).
The Kawayan 3D seismic has substantially improved seismic image quality and greatly mitigated structural risk which is considered a key subsurface risk in the block. Consequently, numerous play types and structures are emerging from the 3D data set in adistinct subsurface fairway in water depths between 70 meters to 500 meters. Work is now focused on maturing the top five leads to prospect status from which the drilling candidate can be selected.
Jon Pattillo, Nido exploration head, said the complex geological nature of the block has required Nido and PNOC-EC to spend considerable time and effort on the processing of the 3D seismic data in order to maximize seismic image quality.
“We have been able to achieve this important objective and it is paying dividends in terms of the potential prospects emerging as we progress our detailed subsurface interpretations,” Pattillo said.
Nido said it plans to fund its 50 percent share of the campaign through existing cash reserves and cash flow from the Galoc production, and that the high interest the company owns in its other permits.
