Perth-based Tetragon Energy has kicked off a new phase of activity offshore the Philippines by awarding a seismic reprocessing contract to fellow Perth-based DUG Technology. The contract, valued at some $1.45m over the next year, is the first major step in Tetragon’s plan to sharpen the prospectivity of its SC-80 and SC-81 permits and support future farm-in negotiations, according to a company announcement.
The Seismic Reprocessing Contract
DUG Technology will reprocess four 3D seismic surveys and an additional 2D dataset across the permits. These surveys were originally acquired between 2005 and 2013 and, according to Tetragon, would have cost more than $20m to shoot at the time. The company obtained the data for free. DUG will apply its imaging technology and supercomputing network to extract maximum value from the datasets. The reprocessing is expected to improve data quality and confidence in the prospects within the licences.
| Cost Item | Amount |
|---|---|
| Original acquisition cost (estimated) | >$20m |
| Reprocessing contract cost | $1.45m |
| Duration of reprocessing | 1 year |
Strategic Importance for Tetragon
Tetragon Energy operates the SC-80 and SC-81 permits with partners Sunda Energy, Philodrill, and PXP Energy. The upgraded imaging should help highlight existing discoveries as well as new targets across the acreage.
“The award of this contract is a pivotal step in our strategy to create substantial value because the results will underpin discussions with potential farm-in partners. By outlining prospects and the existing discoveries in the permits, we will be able to demonstrate the immense upside in these permits to major oil and gas companies,” said Conrad Todd, Tetragon managing director.
The Partners and Permits
Tetragon is the operator of the two permits. Its partners include:
- Sunda Energy
- Philodrill
- PXP Energy
The permits are located offshore the Philippines, a region with ongoing oil and gas exploration activity.
Implications for the Commodity Market
While this contract does not directly affect current oil or gas prices, it represents a clear signal that Tetragon is actively de-risking its acreage to attract outside capital. For commodity analysts and traders monitoring upstream supply developments, successful farm-in deals could eventually lead to new production volumes in Southeast Asia. However, the reprocessing work is a precursor to any drilling decisions, and no timeline for drilling or production has been announced. The next major data release will be the reprocessed seismic results, which Tetragon expects to use in farm-in discussions.
Sources:
