The Energy Department imposed a two-year moratorium on service contract 55 off southwest Palawan, as requested by operator Otto Energy Ltd. of Australia, which decided to abandon the site.
Otto Energy said in a report to the Australia Securities Exchange the two-year moratorium on the required work activity under SC 55 would end on Dec. 23, 2017.
SC 55 involves the exploration, development and exploitation of petroleum resources in the offshore area of southwestern Palawan covering about 9,880 square kilometers.
The SC 55 joint venture will undertake a specialized geophysical study in the interim period to determine if further drilling activity is warranted in SC 55.
Otto Energy undertook the drilling of the Hawkeye-1 exploration well in 2015, delivering the well on time and under budget. The volume of gas discovered in the Hawkeye-1 well was below a level that would be economic to develop which eventually made the company decide to plug and abandon the exploration well.
Otto Energy told the remaining joint venture partners it would not continue with further activity in SC 55 and would assign its working interest to the remaining joint venture partners.