By Alena Mae S. Flores

Australia’s BHP Billiton Petroleum Pty Ltd. is looking at farm-in agreements to increase its oil and gas presence in the Philippines, industry sources said.

The source said BHP Billiton was interested in areas near its service contract 55, which covers the Marantao prospect in southwest Palawan Basin.

The company earlier entered into a “conditional agreement” with Otto Energy Ltd. for a 60 percent stake in SC 55.

The deal made BHP Billiton operator of SC 55, which covers an area of 9,000 square kilometers located near the Malampaya oil and gas field, the largest producer of condensate and gas in the Philippines.

The Marantao prospect is estimated to contain 1,812 billion cubic feet of gas and 567 million barrels of oil. Several companies collected seismic data in the area from 1970 to 1990, but no wells were drilled.

The company plans to start a third seismic survey this year and drilling operations in 2010.

Energy Secretary Angelo Reyes said the entry of BHP Billiton in SC 55 was “one of the best examples of the Philippines being a prime location for investments.”

“This strong showing of investor confidence in the country should give other investors the opportunity to discover other investment opportunities which are available to them,” Reyes said.

Alex Parks, Otto Energy chief executive, said BHP Billiton would bring “a wealth of expertise to the project. “

“This farm out is in line with Otto’s exploration strategy in the Philippines, and BHP Billiton’s interest and involvement in this project is a strong endorsement of our belief in the petroleum potential of the Philippines,” Park said.

“BHP Billiton is one of the largest and most successful companies in the resources sector, and in the event of a discovery of either oil or gas, we couldn’t hope for a better partner to operate such a development,” he added.

Otto acquired an 85 percent interest in SC 55 in 2006, through the purchase of NorAsian Energy Ltd.