Reuters interview, oil within a...

Reuters interview, oil within a month.

http://uk.reuters.com/article/oilRpt/idUKSP4964420080806?pageNumber=2&virtualBrandChannel=0&sp=true

INTERVIEW-Nido thinks big after Philippine Galoc oilfield
Wed Aug 6, 2008 1:12pm BST
* Australian Nido targets big finds, but with partners

* Looks to start smaller projects in Southeast Asia

* Philippines' Galoc delayed, start likely within month


By Maryelle Demongeot

BANGKOK, Aug 6 (Reuters) - Nido Petroleum (NDO.AX: Quote, Profile, Research) will target bigger hydrocarbon finds in Philippine deep waters and smaller, quick-to-develop projects in Southeast Asia, the Australian company's head said on Wednesday.

The small independent has focussed on the under-explored Philippines, and is expecting first oil from the Galoc oilfield there within a month after a series of delays, president and CEO J.V. Emmanuel de Dios told Reuters.

"Galoc is a cash-generator. But what I want is to discover a large field," de Dios said on the sidelines of the ASEAN Business Energy Forum 2008.

Galoc, which will raise the Philippines' oil output by some 70 percent, will produce around 22,000 barrels per day (bpd) once it starts up, de Dios said.

It will be Nido's largest producing asset in the Philippines. The company already produces small volumes from the Nido and Matinloc fields.

The company holds a non-operating 22.28 percent stake in Galoc, which is offshore in the North West Palawan basin.

The commercial decision to develop the field was taken when crude prices were at $65 a barrel, de Dios said, leaving a more-than-healthy margin. U.S. crude stood at around $120 on Wednesday.

He would not be drawn on an exact startup date for Galoc after the field has been plagued with a series of technical problems.

The latest was reconnecting the Floating Production Storage and Offloading system (FPSO) after it was disconnected in late June ahead of a typhoon.

A support vessel will arrive next week to repair a section of the riser, de Dios said.

"The oil is there. I am optimistic that it will start producing sooner rather than later," he said.

First oil would likely come soon after the support vessel arrives, de Dios said, which would set it for within a month.


BIGGER PROJECTS

Nido has started looking for strategic partners to develop potentially oil-rich prospects in the Philippines and at the same time is scouring the region for small projects.

It has said it will farm out some of its stakes in service contracts SC-54, SC-58 and SC-63 in April and has received interest from several companies. Discussions with these are continuing and could last up to five months, de Dios said.

"We are managing ourselves and our risk by ensuring that we have the best partners to help us. We want to maximise our chances of success," de Dios said.

Nido is also looking for smaller projects in the Philippines, and through the region.

"We are not necessarily participating in rounds. Rounds are for exploration blocks. We are looking for marginal fields that we can develop into production, into the Philippines and outside," de Dios said.

The company has identified 160 shallow-water projects in the region but de Dios would not comment on where Nido is most likely to invest next.

Galoc is in relatively shallow-water and two wells were drilled in the 1980s, long before Nido stepped in.

Nido will start drilling two wells in shallow waters in September in the Philippines, its first drilling after an extensive seismic programme. ([email protected], editing by William Hardy)