The first new oil well in the Philippines in 15 years is expected to start production in March, 2008, Energy Secretary Angelo Reyes said Tuesday. The oil well, located in the Galoc Field off the western island of Palawan, will increase the country's monthly oil production from about 17,000 barrels to about 500,000 barrels, Reyes said.
The project costing 86.4 million dollars, was led by Singapore-based Galoc Production Company (GPC) and its partners Australian firm, Nido Petroleum, and local firms. The development of the oil well is part of the Energy Department's intensive search for indigenous energy sources aimed at ensuring energy security, said Reyes.
Drilling for the well has been completed and the company is just waiting to install the equipment, said Kay Palma, country representative of GPC. She estimated that the Galoc field could contain at least 10 million barrels. Because the oil is not compatible for local refining it will likely be exported to South Korea or Dubai.
Located about 65 kilometres (40.3 miles) north-west of Palawan, the Galoc field was discovered in 1981 but its development was delayed by technical problems and lack of funding. Domestic production of oil in the Philippines began in the 1970s but it has been very limited and amounts to barely two percent of local oil consumption.