Australia's Nido Petroleum Limited (Nido or the Company) announced Friday that the Company has signed a Letter of Intent (LOI) with a preferred rig contractor to drill the Baragatan prospect in Service Contract (SC) 63 off Philippines' Palawan Island.
Under the terms of the LOI the Company is unable to disclose the name of the rig contractor until a binding contract is executed between the parties. The jackup the subject of the LOI has the capability to drill in water depths of up to 400 feet (approximately 120 meters) and to drill to a total depth of 30,000 feet (approximately 9,100 meters) sub-sea.
The Company is now progressing negotiations with the rig contractor with a view to signing a binding contract prior to the end of 2013. In recognition that the Joint Venture Participants will now require further time within which to drill the prospect the Joint Venture is seeking an extension of the current Sub-Phase from the Department of Energy (DOE) for a further 12 month period. The Joint Venture has already secured all the other necessary environmental and government approvals to drill the well.
Commenting on the execution of the Letter of Intent with a preferred rig contractor, Nido's Managing Director Phil Byrne stated:
“The signing of the letter of intent is an important step for the Joint Venture and we look forward to finalizing terms on a rig contract as soon as possible. We anticipate the rig will be mobilized and the well drilled in mid-2014.
The remainder of 2013 and the first half of 2014 will be an extremely active period for Nido with an exploration well in the Philippines in SC 63 and 2 exploration wells and an additional side track well scheduled in Indonesia. With a second development at West Linapacan also on the horizon our shareholders have much to look forward to”.
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