Operator Nido and partner Yilgarn Petroleum Philippines, a Yilgarn Gold subsidiary, have been focusing on assessing two areas in the north of SC 54 permit, which is in the Philippines’ underexplored offshore Palawan Basin.

The first of these two areas was covered by the recent 640 square kilometre 3D seismic acquired by the Veritas Viking II as part of the “Abukay” 3D survey, according to Nido head of exploration Jon Pattillo.

“The Coron North prospect is developing into an attractive drilling opportunity,” Pattillo said.

“The prospect is technically robust and shows potential for up to 450 million barrels of oil-in-place based on a closure area of almost 15 square kilometres and reservoir quality from nearby wells.

“Although further technical and commercial analysis remains to be completed before Coron North is mature for drilling, Nido and Yilgarn are excited by the strength and potential size of the structure as confirmed by the 3D seismic.”

In the northwest of the permit, the Princesa lead, based on the Pagasa turbidite play, is also developing positively, the company said. In addition, the seismic had identified several a number of new “Princesa-style” leads based on large submarine fan targets.

An additional 180sq.km 3D seismic program was being planned for the third quarter of 2007 to determine the extent of this play and to confirm the reservoir architecture, the company said.

The second area is the shallow waters in the eastern part of SC 54 where Nido aims to find new opportunities that can be quickly and inexpensively brought onto production to generate early cash flow.

According to Nido, initial interpretation of the eastern portion of the permit has identified 24 pinnacle reef structures in less than 120m water depth, covered by pre-existing 3D seismic data.

“This reef trend is of particular interest, given its proximity and similarity to the producing Nido oil fields,” the company said.

“These pinnacle reef structures are potential candidates for rapid exploitation given the lower drilling and development costs afforded by the shallow water depths. Detailed technical and engineering work will be conducted over the next few months to determine the commerciality of these features.”

More than 30 prospects and leads have been identified within the two initial focus areas and further work is now being planned to evaluate the permit’s southern areas, Nido said.