EXPLORATION Independent focuses Philippines exploration on Visayan basin

Freddie G. Rillera
Cophil Exploration Corp.
Manila

Cophil Exploration Corp., a Filipino public company newly listed on the Philippine Stock Exchange Dec. 19, 1994, spearheaded 1995 Philippine oil and gas exploration activity with the start of its gas delineation drilling operations in Libertad, northern Cebu.

This action occurs within Service Contract (SC) 40, formerly Geophysical Survey and Exploration Contract (GSEC) No. 69 (Figs. 1(33058 bytes), 2(67196 bytes)).

Cophil and its Australian partners, Coplex Resources NL and PacRim Energy NL, have set out to complete a seven well onshore drilling program within this block this year. The companies are testing two modest shallow gas plays, Libertad and Dalingding, and a small oil play, Maya, all in northern Cebu about 500 km southeast of Manila.

Cophil's exploration strategy for the Visayan block has two phases. The initial phase is delineation of the low-risk, small reserves, shallow onshore gas and/or oil prospects cited above. These prospects, although small by international standards (10-30 bcf gas potential), can now be economic, especially with the advent of modular, gas-fired electrical power generating units. Starting in 1996, the second exploration phase, which entails the testing of higher risk but potentially larger prospects defined in the offshore sector of Cophil's block(s), will be pursued.

To carry out its drilling program, Cophil has the advantage of having and operating its own rigs. It has the Hycalog 3500 air-mist-foam land rig being used for its onshore drilling, and the newly acquired Mariner 2 class Pioneer Driller semisubmersible for offshore work.

Cophil used Pioneer Driller to drill its giant gas prospect in Manila Bay on GSEC 72 in June 1995, after which it was made available for contract drilling in the Philippines or elsewhere in Southeast Asia while Cophil prepared for its program to pursue offshore prospects in the Visayas.

Following a short discussion on the geology and exploration history of the Visayan basin, this article briefly summarizes Cophil's ongoing Cebu onshore drilling program. Afterwards, discussion focuses on identified exploration opportunities in the basin's offshore sector.

While the SC 40 consortium has the wherewithal to push through with its onshore program, it is looking at farming out some interest to be able to pursue the more capital intensive offshore drilling objectives in the future.

Geologic setting

Cophil's present acreage holdling in the Visayas (SC 40) covers about 611,000 ha of offshore and onshore northern Cebu. At the same time it is also negotiating with the Philippine Department of Energy for another GSEC over the adjacent West Visayan Sea/Asid Gulf Block, encompassing 810,000 ha (Fig. 1).(33058 bytes)

The above two blocks occupy the northwestern sector of the Tertiary Visayan basin. The Visayan basin is a complex of north to northeast-trending structural troughs separated by elongate ridges that are presently defined in part by some of the Visayan islands, such as Cebu. It is bounded by the Philippine fault zone to the east and the Negros volcanic arc to the west. Sedimentary fills of terrestrial to dominantly marine Tertiary strata in the basinal areas, grabens and depocenters range from 5,000-10,000 m in thickness.

Previous well results demonstrate the presence of oil and gas within Early Miocene to Upper Miocene clastic and/or carbonate reservoirs. Cophil's oil source studies as well as those of previous workers indicate that nearly all of the oil and gas generating rocks of the Visayan basin occur in pre-Middle Miocene strata.

Previous exploration

The Visayan basin is the site of the first identified and well documented oil and gas seeps in the Philippine archipelago. About 130 wells have been drilled in this basin the past 100 years. Most were very shallow onshore tests. Many were poorly placed and not valid tests of four-way dip closures. They were often based on surface geology, which can be demonstrated to be discordant with subsurface conditions. Many of those drilled in later years (post 1957) were located on extremely poor seismic data. Only 10 wells were drilled in some 12,500 sq km of the offshore area.

In places where the seismic data appear of acceptable quality, the features identified have often been stratigraphic traps (Upper Mio- cene reefs).

Following the 1976 discovery of the Philippines' first commercial oil field at Nido off Palawan Island, there was a preoccupation of exploration thinking directed to the location of reefs. This was especially true in the Visayan basin, where there are some exceptionally well developed Upper Miocene reefs that since 1978 have attracted explorers like moths to a burning lamp. Like the moths, the explorers have generally been burned.

These reefs are shallow for the most part, cold, and no identifiable contact with source rocks can be established in any of them, including Marathon Taon 1, POGEI Pilipino 1, and the very recent Ampolex Villaba 1 well off Leyte.

There have, however, been some valid structural and stratigraphic traps drilled in the past. The Phillips Tuburan A-1X well in the Taon Strait is an example of a good reef trap, but unfortunately it had the wrong geologic history. It never had sufficient seal, having continued to grow from Lower Miocene through Upper Miocene. It did have shows in the uppermost portion, but a strong case can be made for it having been tapped by thief zones or stringers on its upper reaches.

Fig. 2(67196 bytes) shows the multiplicity of traps and leads identified in SC 40 and the Asid Gulf GSEC application area. It shows the small, shallow onshore plays as well as the larger anomalies in the offshore described later.

Onshore drilling

Libertad area

The Libertad area south of Bogo town 100 km north of Cebu City (Fig. 2)(67196 bytes) is now the subject of Cophil's delineation drilling program with the objective of defining the extent of its gas reserves.

This area has been known to contain gas since the late 1950s when Acoje Oil & Mineral Development Corp. drilled more than 20 shallow structural and stratigraphic wells on the crest and along the flanks of the Libertad structure. Most notable of these wells were Libertad 11 and 13 (Fig. 3)(83646 bytes), which were completed as productive gas wells.

Cophil conducted a flow test on Libertad 13 in 1993 and established a flow rate of 1.9 MMcfd through a 1 in. orifice. Further analysis of test data indicate that the well has a calculated absolute open flow potential of 5.8 MMcfd. These encouraging results provided the impetus for Cophil to pursue an appraisal drilling program.

Cophil's five well delineation program began Dec. 31, 1994, when the first well, L94-1, was spudded. As of this writing in mid-May, the fourth well, L95-3, has been completed, and Cophil was moving to its fifth location, L95-4.

Of the four wells drilled so far, only the second, L95-1, encountered gas. It was spudded Mar. 6, 1995, and was completed Mar. 19, 1995, as a future gas production well after reaching TD 722 ft.

Drilled on the crest of the Libertad structure about 600 m north-northwest of Libertad 13, the well penetrated the gas bearing Barili limestone at 554 ft. Gas flowed to surface and was flared at the end of the 5 in. blowie line. Based on the length of the flare (about 80 ft), it was estimated that the well was flowing 6-8 MMcfd. A 4 point test is scheduled later to determine production rates more accurately.

The first and third wells, L94-1 and L95-2, failed to encounter any gas as they intercepted the Barili limestone target reservoir at low structural positions. Both wells tested brackish water.

The fourth well, L95-3, which was drilled on the South Libertad culmination, penetrated the Barili limestone at -125 ft subsea, higher structurally than any well on the northern culmination of the overall Libertad trend. The well produced about 2,000 b/d of fresh water.

Cophil will be studying options as to how the Libertad gas resource, possibly in conjunction with this fresh water source, can be viably developed. Based on Cop- hil's appraisal, the Libertad gas resource could be at least 2 bcf.

Dalingding, Maya

The Dalingding and Maya prospects on Daanbantayan Island, northern Cebu (Fig. 2)(67196 bytes), will also be tested in 1995 immediately following the completion of Libertad drilling.

The Dalingding prospect is located at the core of Daanbantayan Island about 25 km north-northwest of Libertad gas field. This is another Barili reef play with an estimated gas resource of 32 bcf. The feature was previously tested with an off-structure well, Podco Cebu-3, 1949, which flowed gas at the rate of 80 Mcfd during 5 months.

The Maya prospect is at the northernmost tip of Daanbantayan Island. This is a small, 2 million bbl oil play based on a 1971 CPC oil discovery well, CMB-2, which flowed 70 b/d of oil with 100 Mcfd of gas from sands at 1,400 ft. The well was eventually abandoned due to drilling problems. Cophil estimates that with the existing good road infrastructure and proximity to the coast, even a modest volume of oil production from the feature could be financially rewarding.

Offshore plays

Agojo to Zapato

The offshore plays studied by Cophil are mostly structural, with some reservoir objectives in older stratigraphic levels. The latter plays are a deviation from the earlier tests, which were largely focused on Late Tertiary reefs.

The traps are large, easily accommodating 50-400 million bbl of oil or a few hundred billion cubic feet of gas if successful. A few of the better-defined offshore prospects are described below. Selected seismic record sections are shown to illustrate some of these features.

Agojo prospect

The Agojo prospect is one of a number of structural culminations that occur off the west coast of Daanbantayan at the northwest end of Cebu (Fig. 2)(67196 bytes). This prospect is situated proximal to the deeper parts of the Taon Strait sub-basin and as such is believed to have close association with a potential oil kitchen.

The Agojo prospect as mapped on the Middle Miocene Maingit limestone horizon has an areal closure of about 1,100 acres and a vertical relief of 350 ft. Assuming average Maingit limestone reservoir parameters, the partially filled trap could house 50 million bbl of oil and/or 300 bcf of gas.

Central Taon Strait

A large undrilled, north-northeast trending anticlinal structure occurs in the central Taon Strait area. At the Barili limestone target reservoir level, the anticline has an areal closure of about 9,000 acres. If charged with hydrocarbons it would be able to hold up to 400 million bbl of oil or more than 1 tcf of gas. There is good reason to believe that the structure may be charged with hydrocarbons. Existing data suggest that the target horizon impinges on the Tuburan reef feature to the south, which had some oil shows (Fig. 4)(129258 bytes). Therefore, hydrocarbons that might have passed through Tuburan could have migrated up into this anticlinal feature, which is some 2,000 ft structurally higher than Tuburan. The ARCO Bangus 1, which was drilled 5 km east of Tuburan, also had minor oil and gas shows (C1 to C2) in the Barili limestone interval.

Jibitnil Island prospect

Underlying Jibitnil Island west of Daanbantayan, northern Cebu, is a classic flower structure referred to as the Jibitnil Island prospect. The prospect is strategically situated within the deeper parts of the Taon sub-basin with 4-7 km of sedimentary fill, where potential source rocks could have attained maturity.

The prospect's main objective is the Middle to Upper Miocene Maingit limestone, which had gas shows in the Oxy Bakyad 1 well 2.5 km to the west (Fig. 5)(130769 bytes). Bakyad 1 was drilled in 1978 at a position some 2,000 ft lower structurally than the crest of the Jibitnil Island feature. It penetrated a tilted carbonate buildup with C1-C4 gas shows. Mud losses of up to 120 bbl/hr were experienced in some intervals. No tests were carried out, however.

Review of existing seismic data reveal that the Bakyad feature has no structural closure and hopefully any hydrocarbons in the area would have migrated updip into the Jibitnil Island structure. As mapped on the Maingit limestone level, the feature has an areal closure of 925 acres and a vertical relief of 650 ft. Volumetric estimates suggest recoverable resources of 85 million bbl of oil or 400 bcf of gas.

North Bantayan

An old faulted anticlinal structure (Fig. 6)(146002 bytes) interpreted to be at the Lower Miocene limestone level has been identified near or at the deepest parts of the Bantayan sub-basin. This play-type has never been tested elsewhere in the Visayan Sea area. Earlier efforts were almost all focused on Late Tertiary reefs.

In the Pilipino 1 well drilled by POGEI in 1976 about 8 km south of the prospect, the equivalent of the target limestone had minor oil shows in the form of slow bleeding, faint yellowish-white cut, and fluorescence on crushed samples. This same limestone horizon is about 2,000 ft structurally higher in the North Bantayan prospect.

The North Bantayan prospect features an areal closure of 5,000 acres and a vertical relief of about 1,800 ft. Assuming 300 ft of net pay, it could hold recoverable resources of 250 million bbl of oil or at least 1 tcf of gas. The structure is interpreted to directly overlie Upper Oligocene to Lower Miocene Malubog clastics, which include the most probable source rocks. The direct contact between the objective reservoir and potential source beds suggest this play is worth pursuing.

West Toledo prospect

This feature is a northeast-southwest trending, wrench-induced fold structure located in the Taon Strait about 15 km west of the Toledo oil area (Fig. 2)(67196 bytes). The possible reservoirs are the Lower Miocene Malubog sands, which have been found in two key wells (Redeco's Reina Regente A-1X and Villalon 4) in the Toledo area, to be oil bearing.

Reina Regente A-1X tested 250 b/d of oil in 1959. It still flows about 1 b/d today. Villalon 4 on the other hand produced 1,979 bbl of 44 gravity oil within 4 days in 1962.

The West Toledo prospect is flanked immediately to the west by the thick sedimentary fill of the Taon Strait sub-basin. It appears to lie in the preferred migration path for any hydrocarbons generated within sand depocenter.

The prospect has a resource potential of 150 million bbl of oil or close to 1 tcf of gas.

Zapato prospect

The Zapato structure (Fig. 2)(67196 bytes) still remains untested and constitutes the largest closed structure defined in the Asid Gulf sub-basin. It has an areal closure of 1,200 acres and a vertical relief of close to 500 ft. Given good development of the target Middle Miocene deltaic sands in this location, this anticlinal feature can have a resource potential of up to 44 million bbl of oil or 200 bcf of gas.

There is room for optimism that the Zapato structure may be charged with hydrocarbons. The present study shows that the feature lies just south of the potential kitchen area and is in a good position with respect to trapping migrating hydrocarbon. The wet gas shows observed towards the bottom of the Zapato 1X well drilled in 1980 further enhance the prospect's potential.

Conclusions

The offshore sector of the Visayan basin remains underexplored. The very few wells drilled have failed to amply test the petroleum potential of this significantly large (15,000 sq km) sedimentary area.

Even more, the previous tests were essentially concentrated on a common play (Late Tertiary reefs), which in all cases lacked the necessary attributes for hydrocarbon sourcing or were missing other key elements (seal, timing, position).

The Visayan offshore area appears to have the necessary ingredients for oil and gas accumulation. Surface seeps as well as shows and flows from old wells demonstrate that hydrocarbons have been generated. Production, while considered subcommercial, has been established in the adjoining islands, particularly Cebu.

Review of existing exploration data demonstrates the presence of many untested prospects within the subject offshore area. Exploration plays capable of containing 25-200 million bbl of oil or a few hundred billion cubic feet of gas have been identified. Table 1(13372 bytes) summarizes the positive aspects of the Visayan basin.

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The Author