Australia's Otto Energy Ltd. reported Monday that its subsidiary Otto Energy Philippines Inc. (Otto Philippines) has signed a farm-in agreement with Red Emperor Resources NL (Red Emperor) to earn a 15 percent working interest in Service Contract (SC) 55, offshore the Philippines.
Otto has also executed a letter of intent with Maersk Drilling, one of the world’s largest offshore drilling companies, to secure the Maersk Venturer (UDW drillship) to drill the Hawkeye-1 exploration well.
Hawkeye Exploration Prospect
Hawkeye is a large turbidite clastic prospect identified on modern 3D seismic acquired in 2010. The Gross Prospective Resource Best Estimate for Hawkeye is 112 million barrels (Net Prospective Resource 74 million barrels to Otto). Success at Hawkeye will unlock a significant new hydrocarbon play in the deepwater Southern Palawan with material follow-up potential in the carbonate leads and prospects (Gross Prospective Resource Estimate ~11 trillion cubic feet or Tcf and ~400 million barrels of Condensate) also identified on 3D seismic. With drilling now to occur in 3Q 2015, Otto shareholders will participate in this exciting and material opportunity.
Red Emperor Farm-in
Red Emperor, listed on the ASX and AIM, has agreed to farm-in to SC55 and earn a 15 percent working interest by participating in the drilling of the Hawkeye-1 exploration well.
This farm-in, along with the $24.5 million funding committed by BHP Billiton and the expression of interest received in January from PNOC-EC for a further 15 percent working interest, ensures that Otto is fully funded and has mitigated significant financial risk associated with the drilling of Hawkeye-1.
Letter of Intent for Maersk Venturer Drillship
Otto Energy Investments Ltd. (a 100 percent subsidiary of Otto and Operator of SC55) (OEIL) has entered into a Letter of Intent with Maersk Drilling to secure the Maersk Venturer ultra-deepwater drillship to drill the Hawkeye-1 exploration well. Maersk Venturer is one of the most modern and advanced drillships in the world. This rig has the required capability to drill the Hawkeye-1 exploration well.
The Maersk Venturer was commissioned in 2014 and was built at the Samsung Heavy Industries yard in Korea. The Maersk Venturer is one of the newest drillships in the world, capable of operating in up to 11,811 feet (3,600 meters) of water, with dual drilling derricks, high capacity mud pumps and bed space for 230 personnel. The Maersk Venturer has recently completed work for Total Malaysia. Detailed contractual arrangements with Maersk Drilling will be finalized in the coming weeks.
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