Proactive Investors - Run By Investors For Investors

Otto Energy to reclaim BHP's interest, moves to 93% of Philippines’ SC55 oil permit

Otto Energy to reclaim BHP's interest, moves to 93% of Philippines’ SC55 oil permit

Otto Energy (ASX: OEL) has executed final binding agreements with BHP Billiton (ASX:BHP) to terminate the farm-out agreement between the two parties over Service Contract 55, offshore the Philippines.

Otto has submitted a request to the Philippines Department of Energy for re-assignment of BHP's 60% working interest to Otto, taking Otto’s working interest in SC55 to 93.18%.

Upon approval of the re-assignment, BHPB will pay US$3 million to Otto, and Otto will lodge a Sub-Phase 4 work program and budget with to drill the Hawkeye-1 exploration well.

BHP will pay a further US$24.5 million to Otto upon completion of drilling the first exploration well in SC55; and
BHP relinquishes all enduring rights to future exploration outcomes or obligations.

Otto has briefed the Department of Energy of its intention to drill the 3D seismically defined, Direct Hydrocarbon Indicator supported Hawkeye-1 exploration well in Sub-Phase 4.

Hawkeye is a turbidite clastic reservoir target in 1,690 metres of water with top reservoir prognosed to be at 2,732 metres, and is also prospective for a carbonate gas/condensate trend, with the potential for an oil charge.

The permit provides a significant opportunity and a series of possible drilling targets for Otto, and drilling could commence as early as Q4 2014, which will certainly garner the market's attention.

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.

View full OEL profile View Profile

Otto Energy Ltd Timeline

December 10 2015
October 02 2015
July 19 2015

Related Articles

North Sea
May 08 2019
Operator Equinor is analysing all the data to assess options at Verbier and the rest of the licence
Northern Territory
May 07 2019
The exploration and appraisal programme will include the drilling and hydraulic fracture stimulation of two horizontal wells
February 15 2019
ExxonMobil has made ten discoveries on the neighbouring Stabroek Block with an estimated 5bn barrels of oil

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use