SC 54 is 100% held by Nido and covers 500,000 hectares. The area neighbours the company's SC 14 and 6B service contracts and the recently applied-for Area 1.

Sub-phase 2 of exploration will start on February 5 and run for 12 months, Nido said.

The primary drilling target is the Coron North structure, mapped as a large four-way dip closed structure with the Nido Limestone as the primary reservoir target, according to Nido head of exploration, Paul Quaife.

“The Coron North prospect is an excellent drilling target," he said.

"It is rare that such a large structure with a proven play type, on trend with a large gas field and oil leg (Malampaya) and adjacent to an oil column (Coron-1) has remained un-drilled.”

In addition to conventional prospectivity, SC 54 has significant upside in the Miocene turbidite play, Nido said.

The reservoir type is considered analogous to the recent oil discoveries made by Hardman and Woodside in similarly aged reservoirs in offshore Mauritania, and by Murphy in offshore Sabah, according to Nido.

The company was currently evaluating this play type, and additional seismic might be needed to mature these leads to drillable status, Quaife said.

Over the last four months, Nido has been actively pursuing a partner in the drilling of a well on Coron North.

“To that end, confidentiality agreements, data packs and presentations have been requested by and distributed to a group of highly credentialed international companies,” Quaife said.

These negotiations were “well advanced and encouraging”, he said.

To combat the worldwide rig shortage, Nido said it was working with the Peak Group, which has significant expertise in the planning, drilling and management of both single and multi-well projects worldwide.

In addition, the company is part of a cooperative strategy between operators and the Philippine National Oil Company to source rigs for drilling individual wells.