Nido Petroleum Ltd. of Australia and its joint venture partners plan to drill a new exploratory well in Galoc oil field northwest off Palawan to confirm the commercial potential of a phase three development.
Nido said in its quarterly report the joint venture continued to progress on the relevant sub-phase and preliminary engineering studies.
Nido managing director Mike Fisher said the appraisal would confirm the commerciality of the phase three development. The company is the operator of service contract 14C1 of the Galoc oil field, holding a 55.88-percent stake.
“Nido is well positioned to capitalize on opportunities in this current low environment and we are looking forward to meeting the challenges ahead as we strive to build a significant regional upstream E & P business,” Fisher said.
Nido and joint venture partners unveiled the plan to develop the mid-Galoc area northwest off Palawan to increase production of the country’s largest oil field as early as July.
Nido said the mid-Galoc area was being considered a potential development project using horizontal drilling and sub-sea completion technology. Galoc Production Company WLL, which owns a 33-percent stake, is the service contract operator.
The preliminary development plans for mid-Galoc are based on drilling two horizontal, subsea development wells tied back to the Galoc field floating production storage and offloading facilities.
Crude oil will be sold by ship-to-ship transfer from the FPSO to the shuttle tanker.
Gaffney Cline and Associates had recently completed an independent contingent resources assessment of the mid-Galoc area of the Galoc oil field.
GSA said the mid-Galoc area was estimated to contain resources of 6.2 million to 14.6 million stock tank barrels.
Nido earlier said oil production from the new field was expected to start on Jan. 1, 2018, with uncertainty range in initial per well oil rate between 2,500 barrels a day and 3,000 a day, attributable to variable reservoir performance.
It said production decline rates in the range of 19 percent to 23 percent per year were applied, consistent with the well performance observed in the Galoc 1 phase development wells.
Nido executive chairman William Bloking earlier said the independent assessment of the mid-Galoc area “represents a significant step-forward in the further development of the Galoc oil field.”
The Galoc oil field is estimated to continue production beyond 2020. The Galoc oil field was earlier estimated to contain 25 million barrels of oil. The Galoc field first produced oil in 2008.