"We believe that by using new technology we can produce oil in the field. We feel the area is viable, considering the urgency to find oil," said Rufino Bomasang, chairman of AustralAsian Energy Ltd.
AustralAsian, a wholly-owned subsidiary of Middle East Petroleum Services (MEP), is focused on oil exploration and production in the AustralAsian region, primarily in the Philippines.
MEP, on the other hand, is part of the Azerbaijani holding company Azersun Holding, and specializes in transporting oil from Kazakhstan and Turkmenistan.
Australian firm Ottoman has exploration activities in the Thrace Basin of Turkey, while RGA Resources is a local firm that was organized to provide technical and management services to the consortium.
The other members of the consortium include Australia’s Ottoman Energy Ltd., and RGA Resources Inc. The consortium has committed to invest $10.2 million during the seven-year exploration period.
The consortium holds Service Contract 50, which covers 172,000 hectares in Northwest Palawan basin including the South Calauit oil fields, another area with confirmed oil reserves.
Bomasang said the area is estimated to contain about 5,000 barrels to 1,500 barrels of recoverable oil per day.
A 155-day extended production test on the area in 1997 showed water-free production at 6,500 barrels of oil a day. The complete exploration and production of the field, however, was suspended because of water intrusion problems.
Bomasang is confident that with more advanced technology, the consortium will be able to extract oil despite the presence of water in the field.