Perth, Feb 26, 2009 AEST (ABN Newswire) - Otto Energy Limited (ASX:OEL)(PINK:OTTEF) is pleased to confirm that production recommenced from the Galoc Field at 21.30 hours local time on 25 February 2009.
Crude oil production is expected to return to pre-shut in levels of 14,000 barrels per day.
During the shutdown period, extensive work has been undertaken on both re-instating the Mooring and Riser System (M&RS) and implementation of enhancements to ensure improved future performance. These enhancements include installation of a secondary mooring arrangement connected to the Floating Production Storage and Offtake (FPSO) stern, referred to as the Hold Back Mooring System (HBMS), and substantial modifications to the primary M&RS.
Modifications included the redesign of critical attachments to the M&RS, installation of additional buoyancy to facilitate lay-down following disconnection, and revision of the associated procedures. These improvements are expected to reduce fuel usage and result in better uptime for the field. However, in advance of approaching typhoons the FPSO will still be required to disconnect.
Otto holds a 31.38% shareholding in GPC, the field Operator which has a 58.29% working interest in the Galoc licence. Galoc is located in Service Contract (SC) 14C off the west coast of Palawan in the Philippines.
Alex Parks
Chief Executive Officer
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Galoc Production Company (GPC) announcement is reproduced below;
Galoc Field - Re-commencement of Production
GPC is pleased to confirm that production from the Galoc Field was resumed at approximately 21:30 hours Manila time this evening 25th February 2009. During the shutdown extensive work was undertaken on both re-instating the FPSO Contractor's Mooring and Riser System (M&RS) and implementation of enhancements to ensure improved future performance and station-keeping.
These enhancements include installation of a secondary mooring arrangement connected to the FPSO stern, referred to as the Hold Back Mooring System (HBMS), and substantial modifications to the primary M&RS which included the redesign of critical attachments, installation of additional buoyancy to facilitate lay-down following disconnection and revision of the associated procedures.
These enhancements are the product of considerable collaborative design effort between the field Operator (GPC) and the FPSO Contractor (Rubicon Offshore International), who is responsible for the provision and operation of the FPSO and associated M&RS. This collaborative effort is ongoing with evaluation of other potential enhancements to the system.
GPC is confident that the re-instatement and enhancements implemented to date will increase the station-keeping capability of the FPSO and enable safe and reliable disconnection in the event of adverse weather.
General Information
The Galoc field is located in Service Contract SC14-C (Galoc Sub Block) in 290m of water approximately 65km north west of Palawan in the Republic of the Philippines. The development involved the construction of two subsea completed horizontal production wells, with extended reservoir contacts, tied back to a Floating Production Storage and Offloading ("FPSO") facility via a short seabed pipeline and mid water riser system. Most likely oil reserves as estimated at time of commitment to the development in 2006, is approximately 10 million barrels.
The reserves estimate and requirement for additional wells and facility capacity will be reassessed following an analysis of results from initial field production performance.
The participating interests in the Galoc Field are as follows:
------------------------------------------------- Participant Participating Interest %-------------------------------------------------Galoc Production Company W.L.L.1 (Operator) 58.29Nido Petroleum Philippines Pty Ltd 22.28(a subsidiary of Nido Petroleum Limited)The Philodrill Corporation 7.03Oriental Petroleum & Minerals Corporation/ 7.57Linapacan Oil Gas & Power CorporationForum Energy Philippines Corporation 2.27Alcorn Gold Resources Corporation 1.53PetroEnergy Resources Corporation 1.03-------------------------------------------------
Galoc Production Company is owned by;
Vitol Group 68.6%
Otto Energy Limited 31.4%
Contact
Jill Thomas
Investor Relations Manager
Tel: +61-8-6467-8800
Mobile: +61-439-440-016
Email: thomas@ottoenergy.com
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