Otto managing director Matthew Allen had previously indicated that the company might look to exit the South-East Asian country to focus on its African and Alaskan interests if Hawkeye-1 was a duster, but the well's 27m non-commercial hydrocarbon column has given it pause.

The well proved an active petroleum system and indications of fluorescence in drilling cuttings confirmed the presence of liquid hydrocarbons in the area of the deepwater Palawan Basin, but unfortunately the hydrocarbons were limited to the seismic DHI [direct hydrocarbon indicators] area and volumetrically sub-economic.

The work will feed into a review of remaining leads and prospects, including the adjacent Cinco prospect that had been BHP Billiton's preferred target when it was involved in the SC 55 joint venture.

Allen said Otto was hoping that by derisking hydrocarbon charge and proving there is the potential for quality reservoir the company might be able to secure a partner willing to fund the next well to test one of the other anomalies on trend now the existence of a source kitchen has reduced geological risk of remaining prospects.

Using the data from Hawkeye-1 the company will recalibrate the numerous mapped hydrocarbon seeps and DHIs.

While that work is being done, Otto is throwing itself into its new play on the Alaskan North Slope.

The company has a staged entry model allows it to earn 8-10.8% working interest in a 558,195 acre position operated by Great Bear Petroleum, with a further $US25 million option over 1824 net acres around the Alkaid-1 well, which is being assessed.

It has paid $US7 million to date, with a further $US7 million due before the end of the month and $US6 million due in the new year to fund drilling commitments.

The option payment will be triggered before the testing or spud of an appraisal well at Alkaid or Phecda next year.

The targets are giant oil prospects in the conventional Ivashak, Kuparuk and Brookian plays, which will be drilled between January and April next year.

A 1700sq.km 3D seismic program is also planned.

Finally, Tanzania, where Otto has 50% of the Kilosa-Kilombero and Pangani blocks with Swala Energy, the company is looking forward to drilling its first well next year to test the 2D-defined Kito prospect in Kilosa-Kilombero Basin.

It's a high risk well. All the work to date suggests the potential for a hydrocarbon generating East Africa Rift System such as the prolific Lokichar Basin and Lake Albert, but the proof will only come in the testing.

The prospect has a possible 50sq.km closure, with Miocene-age reservoirs prognoses between 900-1300m.

Otto's net recoverable resource ranges from 19-170MMbbl.

The well is expected to cost $US3-4 million on a dry-hole basis, which Otto expects to be able to fund from its cash of $US41 million, minus its Alaskan payments, but the company is open to farming down to reduce its risk.