PetroEnergy to join new drillings in West Africa

MANILA, Philippines - Oil drilling firm PetroEnergy Resources Corp. said it will participate in the exploration of new production wells in West Africa.

Benchmark investment is $20 million for each of the seven new wells that will increase output by half, a company executive said.

“Right now, our intention is to increase to 30,000 barrels of oil per day from 20,000 barrels,” PetroEnergy vice-president Francisco G. Delfin Jr. said.

“To do that, we are investing money in drilling more wells. We will be drilling seven more wells, five for production and two for exploration,” he added.

PetroEnergy’s main revenue source is its share in oil production in the Etame field in Gabon, West Africa.

Delfin said $20 million will be spent for each well for an estimated $140 million investment. However, Delfin said PetroEnergy will shoulder just a small portion of the expenses as the firm only has a 2.5 percent stake in the oil project.

To date, there are 11 production wells in the oil field. Since starting operations in 2002, the Etame field consortium has produced 65 million barrels of oil.

New wells will be drilled this year while some drillings will spill over to next year, Delfin said.

“Our production from the known field is expected to last until at least 2021,” Delfin said, adding that it will result in stable revenues for PetroEnergy.

Last year, PetroEnergy’s net income rose five percent to $2.97 million from $2.79 million in the previous year. Oil revenues climbed more than a quarter to $13.54 million from $10.78 million in 2010.

“Our revenue stream from Gabon provides us with funds to do more ventures in the Philippines on renewables,” Delfin said.

PetroEnergy holds Service Contract (SC) 14-C2 in West Linapacan, Northwest Palawan and SC 51 East Visayas.

Delfin said the company is also interested to bid for three oil and petroleum service contracts under the Philippine Energy Contracting Round 4.

Opening for bids in Areas 3, 4 and 5, which are adjacent to the resource-rich Spratlys Islands that is being claimed by China, is scheduled in July.

PetroEnergy owns Maibarara Geothermal Inc., the proponent of the 20-megawatt (MW) Maibarara geothermal project in Laguna and Batangas. Its operations will start late next year.

Maibarara Geothermal is a joint venture between PetroGreen Energy Corp. Tran-Asia Oil and Energy Development Corp. and state-run PNOC Renewables Corp.