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Forum Energy drilling sked given one-year extension.

The long-deferred drilling schedule of Forum Energy at its petroleum block along Recto Bank has been granted anew one-year extension by the Department of Energy.

This will effectively allow the operator firm to kick off with its drilling activities August 2016 - instead of August next year which was the timeline also given a go-signal by the department earlier.

"The deadline for completion of the second sub-phase, comprising the drilling of two appraisal wells, has now been extended by one year to August 15, 2016," the United Kingdom-listed firm Forum Energy has noted in a statement issued from its headquarters.

The extended work program is part of a sub-phase of its exploration and drilling activities under Service Contract (SC) 72 which covers its service area along Recto Bank.

The company which is majority-owned by Pangilinan-led Philex Petroleum further noted that "details regarding the company's plans for SC 72 will be made in due course."

Drilling at the Sampaguita acreage of SC 72 should have started as early as 2013, but due to diplomatic tension troubling the West Philippine Sea, the government opted to grant the project equity holders' bid for work extension.

Companies awarded with upstream petroleum service contracts are required to submit a seven-year work program with the DOE. Any changes that shall be enforced must also be applied with and must secure appropriate approvals from the department.

Two wells - an appraisal well and an exploratory well - had also been originally set for drilling under SC 72's sub-phase 3. Capital outlay for this work component had been placed at $6.0 million to $12.0 million.

Energy Secretary Carlos Jericho L. Petilla previously told reporters that the timeline extension will give Forum Energy enough leeway to prepare for its drilling activities, including contracting process for a rig.

Based on feedback given by Forum Energy, the government is hoping that the block will eventually yield commercial scale of gas that can shore up the country's depleting reserves.

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Title Annotation:Business News
Publication:Manila Bulletin
Date:Jul 11, 2014
Words:328
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