Otto Energy Limited has been verbally advised by BHP Billiton Petroleum (Philippines) Corporation, the Operator of Service Contract 55 (SC55) offshore the Philippines, that it has decided not to participate in the drilling of the Cinco-1 prospect and to withdraw from the SC55 licence. BHPB had provided no previous indication to Otto of its intent not to participate in the Cinco-1 prospect or to withdraw from the SC55 licence.
Otto has yet to receive any written notification from BHPB or detailed substantiation for the basis of its decision. Otto is taking legal advice on BHPB's continuing obligations to fund Otto's working interest through the current Sub-Phase.
Otto will strenuously enforce its full legal rights under the relevant agreements and seek to protect the interest of Otto and its shareholders in relation to Otto's interest in SC55.