Frontier Oil inks drilling contract for Nassiping well

MANILA, Philippines - Frontier Oil Corp., a listed oil and gas company, has signed a drilling contract for the re-entry, deepening and testing of the Nassiping-2 well in Gattaran, Cagayan under petroleum service contract 53.

In a disclosure to the Philippine Stock Exchange (PSE), Trans-Asia Oil and Energy Development Corp., the power generation arm of the Phinma Group said Frontier’s drilling operations are expected to commence in the first quarter of next year.

Trans-Asia has investments in Frontier Oil Corp. It also has an option to acquire 10- percent participating interest in SC 52 from Frontier, which option may be exercised within ninety days after completion of the drilling operations.

 â€œThe SC 52 consortium initially re-entered Nassiping-2 well in February 2012 but flow tests conduction on potential bypassed gas zones in the upper part of the borehole yielded inconclusive results,” Trans-Asia said.

Earlier this month, Trans-Asia said that its wholly-owned subsidiary, Trans-Asia Petroleum is investing P136 million in the initial public offering (IPO) of Frontier Oil slated next year.

Frontier is embarking on an IPO early next year, after deferring the public offer plan, originally slated in the latter part of 2013.

The firm hopes to raise as much as P2.21 billion from the sale of up to 883.63 million common shares at a maximum price of P2.50 a piece to fund drilling of Service Contracts 50 and 52 in northwest Palawan and Cagayan Valley, respectively.

Frontier holds 100-percent working interest in SC 50, which is estimated to contain some 13 million barrels of oil. It also holds 100-percent working interest in SC 52, which is estimated to contain contingent gas resource of as much as 231.91 billion cubic feet.

The Calauit field in SC 50, meanwhile, is estimated to contain 10 million to 13.2 million barrels of oil.

Frontier Oil is an oil and gas exploration firm, which has a 20-year history in the Philippines through various oil and gas project. It also has a subsidiary that is involved in projects in China.