AED updates Indonesian ops
Friday, May 27 2011 - 03:10 AM WIB
Rombebai, Papua (AED 100%)
A careful review of all data provides a more positive view of this relatively high risk but very high reward contract area. There was a gas discovery in the Niengo -1 well which flowed gas at rates which would clearly be commercial with production facilities in place (Absolute Open Flow calculated at 60 mmscf/d of methane). The Neingo discovery was defined by gravity data and a small amount of seismic data back in 1958. Because gas was not marketable at that time, there was no follow-up work done. On the better-defined Gesa anticline, two wells were drilled in 1956 and 1957; both of which had to be abandoned before reaching their objectives due to high pressures accompanied by gas flows.
Given the renewed interest in long term LNG projects caused by the current re-evaluation of nuclear power, particularly in Japan, we believe there will be strong interest among major companies for participation in Rombebai. Importantly, the exploration period on the acreage has recently been extended to July 2013, further increasing the appeal.
The potential gas volumes in the Rombebai contract area may be of world class LNG volumes. Recent remapping of Gesa and Niengo shows potential volumes running from a few Tcf to unrisked figures of more than 30 Tcf in the two prospects combined. A new well on the Gesa anticline, (Kare-1) has been proposed and approved by the Indonesian authorities; detailed planning and permitting is underway. The recruitment of other JV participants by way of a farm-out has commenced.
South Madura (AED interest: 60%)
Our attention has been drawn to the deep Kujung carbonate play by one of our highly experienced geophysical interpreters. This play is successful in the Cepu block to the west and also in the Madura Straits to the south. We believe this trend extends into the South Madura contract area and this is supported by information from the
Kurnia-1 well drilled before AED entered the PSC.
We believe there will be three to six leads for deep Kujung oil and gas targets, which need to be defined by 3D seismic and the next exploration step in the block will be the 3D seismic acquisition. Therefore, the South Madura PSC is of increasing interest to those companies able to provide the capital required for its evaluation. Target sizes are expected to be in the fifty million barrel range and potentially upward to several hundred million barrels. AED is assessing its appropriate working interest in this PSC. (end of excerpt)