Out of a trading halt, Sacgasco has accepted a Letter of Intent for its farm in to service contract to drill the Cadlao 4 well and begin an Extended Well Test as the first stage of redeveloping the Cadlao Oil Field in the Philippines.
The pact with PNOC EC, a wholly owned subsidiary of the Philippines National Oil Company, provides both funding and government backing to redevelop a highly productive oilfield, targeting 6.2 million barrels of economically recoverable oil from one of the company’s numerous offshore Filipino assets.
Sacgasco Managing Director Gary Jeffery said its wholly owned subsidiary Nido plans a two-site campaign, drilling the low-risk EWT well first to provide early cash flow.
Placing the Cadlao EWT as a priority in our planned drilling program, to be followed by a Nandino exploration well, with an EWT upon success, will make for an exciting and potentially transformational 8-month period for Sacgasco and Nido in the Philippines,” Mr Jeffery said.
Jeffery said he was delighted to have secured a funding outcome which provides further impetus to redevelop Cadlao, after which more regional prospects can be pursued and integrated into production from a shallow water oilfield which once produced a peak 6000 barrels of oil a day.
“We have had extensive discussions with suppliers and have identified suitable equipment for an extended well test which if positive and confirms our modelling, will likely lead to a more comprehensive development of Cadlao Oilfield and exploration of the nearby Cadlao East Prospect,” he added.
“All the pieces, including the key team members are coming together rapidly. Shareholders will recall we have
production alliances in place and an option with a potential offtaker for the oil.”
The drillship Deep Venture is now being prepared in Vietnam and will soon be ready for action across number of Filipino oil wells as the archipelagic nation reaffirms its commitments to foreign energy investment.
