Philippines: BHP takes SC-55 farmout off Palawan

By OGJ editors
HOUSTON, May 11 – BHP Billiton Petroleum has exercised an option to take a farmout from Otto Energy Ltd. on Service Contract 55 off Palawan Island in the Philippines.

Subject to joint venture and regulatory approval, BHP Billiton will earn up to 60% participating interest and assume operatorship of the block by reimbursing Otto’s past costs and funding one offshore deepwater well by 2012. The farmout includes an option to drill a second well in a later phase by 2013.
Otto will retain a 33.18% interest.

Otto granted BHP Billiton the option in January 2010. Otto has worked over the past 16 months to shoot, process, and interpret 1,800 sq km of 3D seismic data on the block. The data indicate the presence of an active petroleum system coupled with a series of large to very large Nido carbonate structures that supplement the Hawkeye prospect.

Otto said it has benefited from the cooperation shown by BHP Billiton and Otto’s joint venture partner, Trans-Asia Oil & Energy Development Corp.

Otto will submit the required assignment documents to the joint venture partner and the Philippine Department of Energy for approval of the transfer of participating interest to BHP Billiton.