DOE: $72 million investments seen from Cadlao oil field drilling
The recent green light of a drilling survey in the Cadlao oil field in Palawan is expected to generate over $70 million worth of investments, the Department of Energy (DOE) said Wednesday.
At a virtual press briefing, DOE Undersecretary Alessandro Sales said that Nido Petroleum Philippines Pty. Ltd. committed a total of $72 million for the drilling of two wells in the Cadlao oil field.
“Around $16 million per well as per the budget they submitted. They are undertaking extended production testing so that's an additional $40 million… So if you count that, $16 [million] and another $16 [million] and $40 [million] so a total of $72 million for both contracts,” Sales said.
“When they drill it, they will test the flow rate for a period to determine how to optimize future production and determine the more appropriate way in installing permanent production facilities,” he added.
On Tuesday, President Ferdinand Marcos Jr. announced that the DOE has allowed the drilling survey in the Cadlao oil field by Nido Petroleum, the operator of Service Contract 6B.
Nido Petroleum was allowed to proceed with the site survey of their drilling locations in their service contract areas by the last quarter of this year, Marcos said.
The President added that the activities will pave the way for the drilling of two wells - one exploration and one appraisal, by the first half of next year.
Sales said the volume of oil that can be produced in the oil field is five to six million barrels of oil.
“In terms of daily production, this could come out to a high of 15,000 barrels to a low of 5,000 barrels and these fields will normally decline in time. In terms of actual impact in fluid consumption, the Philippines consumes about 320,000 barrels per day of fuel,” the DOE official said.
“It’s really a very small portion. What’s significant are the signals we are sending out to foreign investors. That we are here, the fiscal and regulatory regime are stable… We are looking forward to a renewed interest in the foreign companies to come in and maybe develop bigger resources in our country,” Sales said.
Cadlao is an old oil field that was last produced in the early 1990s with over 11 million barrels.
“This is just a first step, this will make a massive impact on the oil needs of the Philippines,” Energy Secretary Raphael Lotilla said.
Marcos earlier said Cadlao oil field’s operatorship was taken over by Nido Petroleum from Forum Energy Philippines Corporation (FEPC) in February 2022 to fund the 100% development costs, which include drilling, extended well tests, and subsequent development of the said oil field.—LDF, GMA News