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Manila: Fresh oil was extracted from an offshore Galoc oilfield in southwestern Philippines at the start of production on Thursday, senior officials said, adding the new oil field has been a miracle for the Philippine economy.
"We are expecting some 17,000 to 20,000 barrels of oil per day in the first 90 days of commercial production. This will account for about six per cent of daily local demand of 300,000 barrels per day," said Executive Secretary Eduardo Ermita from the presidential palace.
"The Galoc oil will be known as Palawan Light," said Ermita, adding Palawan's recent oil find was described as "light medium crude oil, with a potential high yield of light ends, such as gasoline."
The extraction of fresh oil from the Galoc oil field began at 10.45am yesterday morning," reported Energy Secretary Angelo Reyes, adding, "The fresh extracts (from Galoc's production) were put onboard a Philippine vessel en route to our local refineries at 11.20 yesterday morning."
The Galoc field has reserves containing 10 to 20 million barrels, initial exploration results showed. "Further studies and exploration can possibly result in additional yields," said Reyes.
President Gloria Arroyo expressed optimism that Galoc's oil will help the Philippine economy, adding it will reduce government annual oil importation of $6 billion (Dh22 billion).
It will also contain the increasing cost of food and other commodities, said Arroyo, adding this will translate into savings of $1.4 billion in foreign exchange for the well's lifetime.
The oil well's development was estimated at three to five years, she added.
Three companies operate Palawan's Galoc field: Galoc Production Company has 58.29 per cent interest. It is composed of European trader Vitol which owns a 68.62 per cent stake, and Otto Energy, with 31.38 per cent. Nido Petroleum has 20.85 per cent interest, and several Philippine partners also have 20.85 per cent.
Costly delay
But repeated delays in the delivery of first oil from the 17,500 barrel per day (bpd) offshore field, initially due to start in the first quarter of this year, mean that its operators have missed this year's oil price rally.
Global crude oil prices are now around $89 a barrel, well off highs near $150 a barrel in mid-July.
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