PRYCE Gases Inc. (PGI), a distributor of liquefied petroleum gas (LPG), is interested to acquire a 10-percent participating interest in Service Contract (SC) 55.
In a disclosure to the stock exchange, PGI’s parent firm Pryce Corp. said it made formal its intention to participate by acquiring 10 percent of Otto Energy Philippines’s 45 percent in SC 55.
SC 55 covers southwest Palawan.
“Please be informed that the company’s subsidiary, Pryce Gases Inc. submitted a formal firm offer to acquire from Otto Energy Philippines Inc. a 10-percent participating interest in Service Contract 55 of the Philippine Government, through the Department of Energy [for the exploration, development, and exploitation of petroleum resources in the offshore area of Southern Palawan] in consideration of PGI’s payment of 10 percent, the well costs and certain other specified costs,” said Pryce Corp., a property holding and real-estate company.
SC 55 consortium is composed of Otto Energy Philippines, 45 percent; Otto Energy Investments Ltd., 33.18 percent; Philippine National Oil Company-Exploration Corp., 15 percent; and Palawan55 Exploration and Production Corp. (Palawan55), 6.82 percent.
“The offer is essentially subject to the condition that PGI is to receive 20 percent of the Filipino Participation Incentive Allowance under the service contract and will be entitled to 10 percent of the cost-recovery pool,” Pryce Corp. said.
In May Otto Energy Investments Ltd., operator of SC 55, said it is set to undertake drilling activities in SC 55 starting July.
This after the Australian-based exploration firm tapped Maersk Drilling to drill the Hawkeye-1 exploratory well in SC 55.
The commencement of the drilling window will be between July 17 and August 15 this year. Drilling operations will be completed in about 23 days.
The drilling of Hawkeye well is estimated to cost anywhere between $30 million and $35 million.
“If the well encounters oil and/or gas, more detailed evaluation will be undertaken and the total well cost may increase by $2 million to $3 million,” Otto said earlier.