The government approved the drilling of an exploratory well in a geothermal power project in Batangas, the project’s proponents said Tuesday.
The Energy Department approved the notice of intent to drill submitted by the consortium of Basic Energy Corp. and Trans-Asia Oil and Energy Development Corp. for the Mabini geothermal project.
“The approved NID [notice of intent to drill] pertains to the drilling of an exploratory well in Geothermal Service Contract No. 8,” the consortium members said in separate disclosures to the stock exchange.
The consortium signed last month a drilling contract with Diamond Drilling Corp. of the Philippines to provide services for the drilling and coring of an exploratory hole with a minimum depth of 1,500 meters.
The drilling program is set to be completed within 90 days.
“Drilling will start during the second week of May,” Trans-Asia senior vice president Raymundo Reyes Jr. said. Total drilling cost is estimated at more than P100 million.
The decision to award the drilling contract to Diamond Drilling, followed the consortium’s rigorous assessment of the technical capabilities of shortlisted contractors, given the approved budget.
Mabini Geothermal Sevice Contract No. 8 covers 3,841 hectares in the Calumpan peninsula.
Based on the pre-feasibility study, the area is projected to yield a power capacity 20 megawatts to 60 MW.
Basic Energy has a 75-percent stake in the project and is the operator of the service contract. Trans-Asia holds the remaining 25 percent.
Under the terms of the farm-in agreement, Trans-Asia will shoulder 25-percent undivided participating interest in the rights, interests, privileges, duties and obligations in and under Geothermal Service Contract No. 8.
Basic Energy was originally incorporated as Basic Enterprises Inc. on Sept. 19, 1968 and became an oil and gas exploration and development company on April 26, 1971, assuming the name Basic Petroleum and Minerals Inc.
The company evolved from an operating company to a holding company under the corporate name Basic Consolidated Inc.