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SC 56 is a Service Contract (SC) located in Philippines waters off the northeast coast of Borneo. The SC became effective in August 2005. Following a series of transactions with the four original PSC co-venturers, Mitra Energy (Philippines SC-56) Ltd became operator of the SC in January 2006 with a 100% equity stake. The SC initially covered an area of 8,620 square kilometres and was reduced to 6,460 square kilometres, equivalent to approximately 281 Gulf of Mexico blocks, or 27 UK Central North Sea blocks, after 25% mandatory relinquishment taken place in August 2010.
Under a farm-out agreement effective July 2008 ExxonMobil acquired a 50% equity holding in the SC and operatorship. Assignment of 25% equity in SC 56 from Mitra Energy (Philippines SC-56) Ltd to BHP Billiton Petroleum (International Exploration) Pty Ltd was also approved on 17th September 2009.
Effective on 31st October 2011, both ExxonMobil and BHP Billiton elected to withdraw from the SC and their equities were assigned to Mitra. Following the withdrawal, Mitra holds 100% equity in the SC.
The SC is located in water depths ranging from 0 to over 3,000 metres, covering the transition from offshore shelf to abyssal plain. The principal hydrocarbon play is contained within Miocene deepwater turbidite depositional systems in the distal setting of the Sandakan Basin. Gravity-induced thin-skinned tectonism has given rise to a number of large toe-thrust anticlinal structures which have significant hydrocarbon potential, analogous to other circum-Borneo proven deepwater toe-thrust belts, such as the Kutei Basin and NW Sabah.
In November - December 2006, Mitra acquired 2,265 line kilometres of 2D seismic data in order to better delineate the toe-thrust play. Additional potential was identified on the data, in many cases supported by evidence of potential Direct Hydrocarbon Indicators (DHIs). On the basis of the 2D data, a 1,756 square kilometres 3D seismic survey was acquired in the second quarter of 2007 in order to provide detailed sub-surface imaging of the prospective structures.
Interpretation of the processed pre-stack depth volumes from the 3D seismic confirmed the presence of a number of DHI supported prospects on the block and significantly reduced the overall risk for the play, which was characterised as moderate risk, high reward.
As part of the phased commitment work programme, exploratory drilling commenced on the block in late 2009 utilising the West Aquarius DPSS rig. The first well, Dabakan-1, was a significant play-opening discovery and encountered natural gas in multiple reservoirs. Subsequently, the Banduria-1 well was drilled in early 2010 and was plugged and abandoned with oil and gas shows. The third well, Palendag-1, was drilled in mid 2010 and resulted in a second gas discovery in the SC. Mitra elected not to take part in the fourth well, Babendil-1, which completed operations on 9th October 2010.
An independent best estimate Contingent Resources of the gas discoveries in Dabakan-1 and Palendag-1A is 134 million barrels of oil equivalent (mmboe) with a high estimate of 343 mmboe, plus Prospective Resources associated with the discoveries of 128 mmboe (best estimate) and 195 mmboe (high estimate). In addition, considerable exploration potential exists in multiple undrilled prospects in the block. Resource estimates are currently in progress, it is anticipated that upside block wide potential will exceed 10 TCF gas equivalent. |
