AAL farm-out progressing as scheduled
Tuesday, July 30 2013 - 12:59 AM WIB
ASX-listed oil and gas company AWE Limited announced on Tuesday that the farm out of up to 50 percent of the Northwest Natuna PSC, Natuna Sea, which includes the Ande Ande Lumut (AAL) Oil Field development project, is progressing as planned and a physical data room has been opened in Jakarta.
Perth-based consultant RPS Energy Services completed an independent audit and certification of the AAL Contingent Resources in May 2013.
Subsequently, AWE increased its estimate of gross recoverable oil for the AAL K-Sand reservoir by 25 million barrels (33 percent) to 101 million barrels, it said in a filing.
AWE has also assessed an additional 35 million barrels of gross recoverable oil in the underlying G-Sand reservoir which has been classified as Gross 2C Contingent Resources.
As a result of these increases and reclassifications, AWE booked 50 million barrels of Net 2P Reserves for AAL, which represents the company?s entitlement under the terms of the PSC, as well as 15 million barrels of Net 2C Contingent Resources.
Another positive milestone, the regulatory approval for AWE?s revised reservoir development plan, has been achieved. The revised development plan involves drilling 33 longer reach horizontal wells into the K-Sand reservoir to achieve total recovery of 101 million barrels of oil, an increase of 25 million barrels over the original development plan.
Updated development cost estimates for the revised development plan are currently being finalized, but will be higher than the original plan of development (PoD) estimate of US$600 million to reflect the additional drilling.
Front End Engineering and Design for the well head platform has commenced.
Contractor pre-qualification for the Floating Production Storage and Offloading (FPSO) has been extended in order to allow all potential bidders time to complete submissions and to meet the Indonesian Government?s regulatory requirements.
As a consequence, completion of the FPSO design competition and subsequent Final Investment Decision (FID) for the project is likely to extend into the first half of 2014.
Editing by Dadan Wijaksana