Otto Energy Provides Update on Galoc-5H and Galoc-6H Drilling Campaign

Otto Energy Limited, as operator of the producing Galoc oilfield joint venture offshore the Philippines, provides update on the Galoc-5H and Galoc-6H drilling campaign in SC14C, part of the Galoc Phase II development approved in 2012.

Progress

During the period from 0600 hours (AWST) on 10 July 2013 to 0600 hours (AWST) on 17 July 2013, drilled the G-6H 12.h hole section to 2,554 metres. The well has been steered to near horizontal, ready for commencement of drilling the long (approximately 2,000 metres) horizontal productive section through the reservoir. 9.” casing operations have commenced. Logs obtained whilst drilling have confirmed that the well has penetrated the oil bearing Galoc reservoir sandstones in line with the pre-drill prognosis.

Forward Plan

The forward plan is to complete setting and cementing the 9.” casing on G-6H prior to moving to the G-5H well to drill the 12.h hole through to reservoir at approx 2,500m MD, then run and cement 9.” casing.

Location and Proposed Depth

The Galoc field is located in Service Contract SC14C (Galoc Sub Block) in 290 metres of water approximately 65km North West of Palawan Island and 350km south of Manila in the Republic of the Philippines. The Galoc-5H and Galoc-6H development wells are being drilled within the existing producing field that has delivered over 10 MMbbls of production since the field was commissioned in 2008.

The wells are being batch drilled in 311 metres of water. It is planned that the Galoc-5H and Galoc-6H development wells will be drilled to a total vertical depth of 2,190 metres with approximately 2,000 metres of horizontal completion. Drilling is expected to take approximately 115 days including the flowing of the wells for clean-up.

After drilling of both Galoc-5H and Galoc-6H is completed, the DOF operated Skandia Hercules construction vessel will be used to install the subsea equipment and complete the hook-up of both wells to the FPSO Rubicon Intrepid.

First oil from the Phase II wells is expected during Q4 2013.

Press Release, July 17, 2013