The combination of low oil prices and a delayed start to production has bitten oil play Otto Energy, which is being forced to hand over every dollar of operating profit after failing to meet its debt repayments.

Production from the Galoc oil field in the Philippines, in which Otto holds an 18.3 per cent indirect interest, was originally slated to begin in mid-2007 but was delayed until early October 2008 after a typhoon damaged a key piece of equipment.