Otto Energy announced Wednesday that it has executed the final farm‐in agreements supporting BHP Billiton's earlier decision to enter into Service Contract 55, Offshore Palawan, Philippines.
The execution of the final documents follows the previously announced decision by BHP Billiton to exercise their farm‐in option in May 2011. With the execution of these final farm‐in agreements, Otto will receive a final payment relating to back costs associated with SC55 of US$7.3 million, of which $5 million has already been received.
Otto will submit the required assignment documents to the Philippine Department of Energy for their approval of the transfer of participating interest to BHP Billiton.
"2012 is an exciting year for Otto shareholders as we prepare for drilling of the Cinco prospect in SC55, offshore Palawan in the Philippines during the second quarter. More importantly for Otto shareholders, there is a depth of opportunity beyond this first well in our acreage portfolio that provides ongoing exploration and development potential," said Otto's Chief Executive Officer Gregor McNab.
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