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Good News, For Once

June 3, 2008

This writer’s favorite newspaper, the Business Mirror, is reporting this piece of truly good news that comes just once in the proverbial ‘blue moon’, so allow us to share this with you in full:

First oil from Galoc field expected
to flow early this month:Nido
By Paul Anthony A. Isla
Reporter

FOLLOWING the hookup of the mooring tether to the floating production and storage offloading (FPSO) facility, Australia-based Nido Petroleum Ltd. said it expects first oil from the Galoc oil field in offshore Palawan early this month.

Nido said it has been advised by its partner Galoc Production Co. (GPC) that the hookup of the mooring tether to the FPSO has been completed successfully.

Nido added that testing of the dynamic positioning systems of the vessel is now under way, following which the production riser and control umbilical will be connected and tested.

Nido noted that the commissioning and testing of the production facilities will then be undertaken prior to the startup of oil production.

The Galoc field, which is located in Service Contract SC14-C (Galoc Subblock) in 290 meters of water approximately 65 kilometers northwest of Palawan, is estimated to have oil reserves of approximately 10 million barrels.

Nido earlier said the Galoc 3 horizontal production well recently flowed oil to surface at a maximum rate of 5,397 barrels of oil per day (bopd), a development hailed as a “milestone” leading to production service.

The oil flow to the surface “the first time since 1988” happened during a cleanup flow testing on February 20 and 21.

Emmanuel J.V. de Dios, Nido chief executive officer, said this is a particularly exciting time for Nido as first oil will deliver the cash flow to fund its forthcoming exploration program.

“We continue to be bullish as to what the Northwest Palawan Basin holds for us. We are, of course, also very excited about what Galoc means for the Philippines, given the country’s dependence on imported oil,” said de Dios.

Joanne Williams, Nido deputy manager, said the flow results from Galoc 4 are tremendous, and that both wells (Galoc 3 and 4) have flowed to surface at commercial rates and are ready to be hooked up to the FPSO.

Nido said it estimates that the combined productivity of the two wells is at the high end of the expected range, which will be confirmed following an update to the reserves certification which Gaffney, Cline and Associates will perform on Nido’s behalf.

“With the drilling and completions phase concluded, the focus of the project has turned toward the hookup and commissioning of the FPSO and the anticipation of first oil,” said Williams.

Nido said both wells are now shut in pending the installation of the mooring and riser system and hookup to the FPSO Rubicon Intrepid over the coming weeks.

The drill ship Energy Searcher will demobilize to Singapore prior to being released from service by the project. The specialist installation vessel Lewak Champion will arrive at site shortly to start work.

Nido said the Galoc oil flowed to surface unassisted, consistent with expectations, and that its oil samples have been collected for analysis.

“We are excited to reach this important milestone in the Galoc development project today. The Galoc 3 well has flowed as designed and is now ready for production service,” said Williams.

Business Mirror

Ok, now that we’ve all read the story, let’s pause and thank God, not any politician, for this wonderful development.

We add this reminder because as the recent house energy committee hearings revealed. various taxes are levied, of course, on the local crude most especially the infamous VAT), along with royalty payments, so the national coffers can take receipts. So, at least conceptually, this will go to cutting the budget deficit and such, and again, conceptually, more money will become available for social services and foreign debt payments, but not necessarily in that order. And don’t forget our contribution to the pork barrel and discretionary  funds of those ‘in the public service’.

Let’s not yet remove the tansans (bottle caps) from the celebratory SanMigs, ok?

One Comment leave one →
  1. June 3, 2008 8:51 am

    Fingers crossed all goes well in the next week so with the commissioning of Galoc oilfield.

    Another aussie company with interest in Galoc Oilfield is Otto Energy (ASX:OEL)

    with oil price above US$127bbl both companys will be printing money.

    best wishes

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