Australia-based Otto Energy has been awarded a new offshore exploration permit by Philippines Government under a Service Contract 73 (Area 7) in the Mindoro basin.

The company, through its local unit NorAsian Energy Philippines, won the bid for Area 7 during the 4th Philippine Energy Contracting Round launched in 2011.

The company will now start reprocessing existing seismic data with a minimum budget of $0.5m within an initial period of 18 months.

The SC 73 offshore block covers around 3,259sq m (8,440 sq km) with water depths ranging from 328ft (100m) to 4,265ft (1,300m).

There is an existing 2D seismic data set of more than 1,864 miles (3,000km) covering the block.

In 1994, oil was discovered near the block at the Maniguin wells, flowing at a rate of 200bpd during production tests.

Otto Energy CEO, Gregor McNab, said the addition of the new exploration acreage is consistent with company’s strategy to build an integrated exploration, development and production company focused on south-east Asia and East Africa.

"Service Contract 73 has the potential to restock our existing, high impact, exploration prospect inventory," McNab added.

Image: Area 7 location in the Mindoro basin, offshore of the Philippines.