Nido Petroleum Philippines Pty Ltd. is awaiting the Department of Energy's (DOE) declaration of commerciality to expand the oil exploration and production efforts for Service Contract 54 (SC 54) in offshore northwest Palawan.
The project, covering 43,515 hectares of predominantly shallow waters, aims to tap into the region's hydrocarbon reserves, particularly in the Nandino prospect and nearby fields such as Tindalo, Yakal, and Nido-1X1.
The project is being implemented in three phases. The first phase includes appraisal drilling and extended well tests in the Nandino field to evaluate its production potential.
The second phase will commence once the DOE grants the commerciality declaration, allowing for additional exploratory drilling.
The final phase, on the other hand, will integrate adjacent fields to optimize production, with revenues from initial operations funding further development.
The project’s initial operations were originally set to begin in 2023, with full production dependent on the DOE’s declaration of commerciality.
An affiliate of Australian oil and gas firm Nido Petroleum Ltd., Nido Petroleum Philippines leads the SC 54 consortium as the technical operator.
The Northwest Palawan basin, a proven hydrocarbon fairway since the 1970s, has hosted 11 commercial oil and gas fields, including the Malampaya gas field. Exploration in SC 54 has revealed significant potential, with each well estimated to hold 2 to 20 million barrels of oil.
Classified as an Environmentally Critical Project, SC 54 adheres to Philippine regulations, including submitting an Environmental Impact Statement and implementing safeguards. These measures include waste management, pollution control, and the use of oil spill trajectory models to protect marine ecosystems.
Additionally, SC 54 is aligned with the Philippine Energy Plan (PEP) 2020-2040, which aims to reduce the country's reliance on imported oil, which currently accounts for 82 percent of national consumption.
The PEP aims to drill at least seven oil prospects and six gas fields within a 20-year timeline to significantly boost the country's oil reserves by 2040.