Galoc Production Company holds the Otto’s interest in the Galoc oil field, which is situated 60km north-west of Palawan under the Philippines Department of Energy (DOE) service contract 14C1.
Nido is planning to fund the acquisition through a combination of existing cash reserves and debt.
The water depth ranges between 290m and 400m at the Galoc field with oil located in a turbidite sandstone reservoir at depth of approximately 2,100m below the sea surface.
Nido Petroleum managing director Philip Byrne said: "Acquiring Otto’s stake in Galoc is a logical growth opportunity for Nido and one that fits neatly with the strategy Bangchak communicated upon taking majority ownership of the company earlier this year.
"Nido’s increased participating interest and appointment as operator will also put the company in a controlling position as the joint venture moves forward towards a further potential expansion of the Galoc oil field."
The transaction is expected to increase Nido’s production base to more than 4,000 barrels of oil per day.
The company’s major shareholder Bangchak Petroleum has committed to provide a revolving debt facility of $120m.
Nido’s stake in the Galoc oil field will increase to 55.88% if its offer is successful. The company will also assume operatorship of the project.
