Canadian firm to spend $1.5b on Indonesia drilling campaign

Canadian oil, gas firm Niko Resources Ltd. and partners will spend in the order of US$1.5 billion in gross spending for drilling campaign in Indonesia in the next four or five years.

The company said that the campaign will be one of the largest programs ever undertaken by a Canadian company. The company did not give detail about the number of wells it will drill.

Niko now has sixteen blocks-12 of which are operated by the company- and a further two blocks await government approval.

On November 8, 2011, Niko announced largest deepwater exploration contract in the history of Indonesia with a subsidiary of Diamond Offshore ? a major deepwater drilling contractor. The contract with one-year option exercised is valued in excess of $700 million. The campaign will start next year.

Thus far, the company has spent $425 million on leading edge technology and acreage accumulation in Indonesia.

Prospects on only four of the blocks have been evaluated by Netherland Sewell Associates Inc. who estimated 13.6 billion barrels of oil equivalent as the ?best estimate? gross unrisked undiscovered in-place volumes, the company said.(romel)