Pitkin Petroleum signs farm-in deal for Octon Block

UK-based Pitkin Petroleum Plc signed on Monday a farm-in agreement with a consortium of local oil and gas firms for a 70-percent stake in service contract 6A (Octon Block) in northwest Palawan. In a disclosure to the Philippine Stock Exchange, Philodrill Corp. said that Pitkin will acquire 500 square kilometers of 3D seismic data costing around $5 million in exchange for 70 percent participating interest from the Octon block partners. “Moreover, Pitkin, should it exercise its options, would drill up to two wells in the block at no cost to the farming out parties," Philodrill said in the disclosure. Pitkin is partially owned (18.46 percent) by the Philex Group, through wholly-owned subsidiary Philex Petroleum Corp. The company is an international upstream oil and gas company that focuses on tertiary basins. They also hold a stake in service contract 14C (West Linapacan Block) in the Northwest Palawan Basin. “The farm-in agreement and deed of assignment are subject to the approval of the Energy Department," Philodrill added. Involved in the farm out are Alcorn Gold Resources Corp., Anglo-Philippine Holdings Corp., Forum Energy Philippines Corp., PetroEnergy Resources Corp., Philex Petroleum Corp. and Trans-Asia Oil and Energy Development Corp. Discovered in 1991, Octon is estimated to contain up to three million barrels of oil reserves and over 34 billion cubic feet of natural gas of which three billion can be recovered. The consortium partners are looking into developing the Octon Block alongside the proposed phase two of the Galoc oil field in offshore northwest Palawan. In March, the Energy Department reported that as of February 2011, the Galoc oil field has turned over nearly P1 billion in royalties to the Treasury Department. — BC/VS, GMA News