San Isidro oil drilling seen to extract 18 M barrels of oil

TACLOBAN CITY—An estimated 18 million barrels of oil could be extracted if the drilling operation would be completed in San Isidro, Leyte, an Energy official said.
 
Engr. Eduardo Amante, chief of the Energy Resources Development and Utilization Division of the Department of Energy Visayas office said Otto Energy Ltd., is scheduled to start its drilling operation within this month and is hoped to get millions of barrels of oil from the site.

Otto Energy Ltd., which is in charge of the Duhat-1 exploration well in Service Contract (SC) 51 in Leyte, will be sinking in $2.5 million-$3 million for the drilling operations.

“Based on initial studies, the area has enough deposits of oil which we could get as high as 18 million barrels,” Engr. Amante said.

He added they could not determine the exact amount of oil that could be extracted since the drilling is yet to be completed.

Early this year, Otto Energy signed a “farm-out” agreement with Swan Oil and Gas Ltd. for Service Contract 51 in the Visayas.

A “farm-out” agreement allows a company to offer part of its participating shares in a service contract to another company to help fund projects in the area.

The agreement has been approved by the SC 51 joint venture partners and is awaiting the approval of the Department of Energy.

The service contract covers 332,000 hectares. The drilling of the Duhat-1 exploratory well is part of the current sub-phase of the contract.

Partners in the consortium are Trans-Asia, Alcorn Gold Resources Corp., PetroEnergy Resources Corp. and NorAsian Energy Ltd., a unit of Otto Energy.

By REYAN ARINTO
Correspondent

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