NIDO Petroleum Philippines Pty. Ltd. and consortium partners will spend at least $25 million per well to pursue drilling activities in offshore Northwest Palawan.
In a filing, Nido said the estimated expenditure for the drilling well activities in Service Contract (SC) 91 is at least $18 to $25 million per well.
The SC91 will be developed by its operator, Nido Petroleum, and other consortium members including Alcorn Petroleum and Minierals Corp., Forum Energy Phillippines Corp., Oriental Petroleum and Minierals Corp., The Philodrill Corp. and PNOC Exploration Corp.
The SC 91 covers an offshore area of about 103,034 hectares in the Northwest Palawan Basin and replaces the former SC 6B, which expired on Feb. 28, 2024. The new contract includes aims to re-evaluate and develop untapped oil reserves in the Cadlao Oil Field, which previously produced about 11.2 million barrels of oil between 1981 and 1991.
The redevelopment plan for SC91 will consist of two phases. The first will involve the drilling of one well with an upfront three to nine month extended well test in case drilling outcome favors commerciality.
The second phase will involve adding one to three wells, with production restart estimated to commence in the second half of this year or first half of 2027.
Exploration well drilling is conducted to establish the extent and size of a petroleum deposit that has already been discovered. Appraisal drilling is then carried out once oil or gas has been discovered in order to assess the extent of the field, the reserves, the possible rate of production, and the properties of the oil and gas.
Production activities will commence following successful exploration and appraisal confirmation of the commercial viability of the discovered hydrocarbon resources. Production will involve the drilling and completion of production wells.
Nido Petroleum was formally awarded the petroleum service contract in April this year by the Department of Energy.
The SC91 is part of the government’s push to expand indigenous oil and gas exploration under Presidential Decree 87.