DOE clears SC 91 for Cadlao oil revival

The Department of Energy (DOE) has cleared Petroleum Service Contract (SC) No. 91 covering the Cadlao Block offshore Northwest Palawan, paving the way for the potential revival of a previously producing oil field with remaining untapped reserves.

PXP Energy Corp. and Oriental Petroleum and Minerals Corp. confirmed in separate disclosures that the DOE released the executed contract to the consortium on Tuesday, 21 April.

PXP said this “signifies the formal effectivity of SC 91 and was issued for proper safekeeping and implementation,” referring to the April 13 contract signed between the Philippine government and a consortium led by Nido Petroleum Philippines Pty. Ltd.

SC 91 covers approximately 103,034 hectares in the Northwest Palawan Basin and includes the Cadlao Oil Field, which produced about 11.2 million barrels of oil between 1981 and 1991. 

The contract replaces the expired SC 6B, which reached its 50-year limit in February 2024.

The new service contract is expected to support efforts to redevelop the field by targeting remaining oil identified through past studies.

PXP said “3D seismic data… indicated that the original wells had bypassed a significant volume of attic oil… (which) has since been identified as a key target for potential field redevelopment.”

Oriental Petroleum likewise said “based on recent study, the former Cadlao Oilfield still has extractable oil reserves prior to its expiration in 2024,” reinforcing the field’s redevelopment potential.

The consortium structure remains largely unchanged, with Nido Petroleum Philippines Pty. Ltd. as operator alongside The Philodrill Corp., Oriental Petroleum and Minerals Corp., Alcorn Petroleum and Minerals Corp., and Forum Energy Philippines Corp. (FEPCO).

PXP, through FEPCO, holds a 2.4546 percent participating interest that is free-carried up to first oil, while Oriental Petroleum retains a 4.9092 percent stake carried over from the previous contract.

With SC 91 now in effect, the consortium is expected to move toward technical re-evaluation and planning for redevelopment, with any drilling and eventual production dependent on confirming commercially recoverable volumes. 

If successful, the project could restore output from the Cadlao structure and contribute incremental domestic oil supply.