Cebu oil exploration granted 2-year moratorium

ALOGUINSAN, Cebu — The Department of Energy (DOE) has granted a two-year technical moratorium to Australian firm Gas2Grid in relation with its oil exploration in Brgy. Olango, Aloguinsan town.

The moratorium on oil exploration in the Malolos-1 Oil Field in Aloguinsan allows Gas2Grid enough time to complete its studies and establish appropriate technology to maximize sustainable oil production, the company said in a statement.

“Service Contract 44 is currently in a 2-Year Technical Moratorium until 27th January, 2017,” the company said.

DOE said the company will continue with technical work in conjunction with industry experts analyzing all available technical data to identify the completion of technology that will minimize sand and clay production to avert production blockage and maximize oil production rates.

Gas2Grid earlier announced an increase in oil production in the Malolos-1 Oil Field in southwestern Cebu.

In a report last year, the company said it recorded very encouraging oil flow.

“The increased oil production rate indicates that remedial work has had some success in clearing perforations to allow an influx of oil from the reservoirs,” the statement said.

“The Malolos-1 well has again demonstrated that it can produce oil at commercial rates,” the company said.

The well has previously produced approximately 200 oil barrels daily on several occasions but only for short periods.

Oil flow has reportedly been impaired when holes made on the sandstone became clogged.

The company said the well will continue to be tested to establish longer term oil production rates.