MANILA – Australia-listed Otto Energy Ltd. said on Monday it would plug and abandon a deep-water exploratory well in the West Philippine Sea (South China Sea), which did not reveal commercial oil and gas volumes.
While the drilling of Hawkeye-1 well in the Philippines’ Palawan Basin has proven the existence of hydrocarbons in the area, the size was “at the very low end of expectations and is not economic to develop,” Otto said in a statement.
Otto has a 78.18 percent interest in Service Contract 55, a drilling permit issued by the Philippines’ Department of Energy for the Hawkeye 1 well.
The SC55 consortium includes Red Emperor Resources of Australia with a 15 percent interest and Palawan 55 Exploration and Production Co, a unit of the Philippines’ Trans-Asia Petroleum Corp., with 6.82 percent.
Otto shares plunged as much as 46 percent to A$0.033, while Red Emperor fell 51 percent to A$0.032. In Manila, Trans-Asia Petroleum stock plummeted 50 percent to P4.49.
SC55 is located near the Southeast Asian country’s Malampaya natural gas field, operated by Shell and supplies fuel to three power plants generating 2,700 megawatts for the main Luzon island.
Otto said the results from Hawkeye 1 well drilling would augment the data that could support other prospects such as the nearby Cinco well.
Read More: http://www.abs-cbnnews.com/business/08/17/15/australias-otto-energy-abandons-ph-hawkeye-1-well