GAS

Ottoman shifts Filipino assets into new company

OTTOMAN Energy and its overseas joint venture partners will merge their Filipino petroleum assets into a new company – NorAsian Energy – which is seeking to raise US$55 million in a convertible note issue.

Ottoman shifts Filipino assets into new company

Its partners AustralAsian and RGA Resources will similarly move their oil and gas assets in the same three Filipino licenses – SC50, SC51 & SC55 – into NorAsian.

Ottoman said Norwegian financial broker, Pareto Securities, would undertake the capital raising to enable NorAsian to “aggressively” explore and develop the Philippines assets.

Successful completion of the convertible note issue would allow for commercial development of the Calauit field (SC50) due for drilling in the first quarter of 2006, according to Ottoman.

This includes securing a semi-submersible rig to drill three exploration wells in the field, which contains a potential 370 million barrels of unrisked reserves, claimed the company. In addition, NorAsian is negotiating to secure a 300-foot jack-up rig.

“In the current tight rig market, NorAsian will be in a unique and highly advantaged position of having a large semi and a jack-up on long term contracts,” said Ottoman managing director Jaap Poll.

“In addition, ownership of the floating production platform North Sea Pioneer, which will require refurbishment, provides NorAsian with the ability to use these units to develop other oilfields either through farm-ins or new license awards.”

NorAsian will acquire this 45,000 bopd production capacity platform after recently signing an agreement to acquire Singapore-based Frigstad Producer Invest Ltd, which owns the rights to the unit.

The Calauit field is expected to come onstream early next year at an expected initial rate of about 15,000 barrels of oil per day, said Ottoman.

“Production testing from the first well will continue for some months to determine the scope of the project before the second and third well will be drilled using the jack-up and brought into production, bringing the cumulative initial flow rate of the Calauit Field to around 26,000 bopd,” Poll said.

“It is anticipated that NorAsian will mobilise the semi by mid November which will re-enter the existing Calauit 1B well and drill a horizontal well from this location as a sidetrack from the existing well-bore.”

Ottoman said a successful convertible note issue would also fund further seismic on the existing Marantao Ultra Deep Water prospect to prove up Giant to Super Giant potential.

Upon the issue’s success, the new entity will acquire a balanced portfolio of exploration and production acreage in the Philippines. This includes the high chance of success at the Calauit Oil Field with its proven reserves, the medium risk / high reward East Visayan Basin Permit and the potentially very high reward, though high risk/high cost Marantao Lead in ultra-deepwater to the west of the island of Palawan.

The notes have a three-year term, carry a 10% coupon – with first payment in November next year – and are convertible at 133% of base US$1 per share for NorAsian.

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