CBM Asia to start drilling at newly acquired PSCs Q2 2012
Saturday, December 3 2011 - 02:34 AM WIB
The company said on Friday that work program at the Hulu, Central Sumatra and Bentian Besar, East Kalimantan PSCs includes two exploration core holes and two production test wells on each PSC, with pilot production programs to follow in first quarter of 2013.
The company also anticipates National Instrument 51-101 compliant resource estimates for the Hulu and Bentian Besar PSCs to commence in the fourth quarter of 2012, based on results of its 2012 work programs.
CBM Asia signed deal to acquire 70 percent operating interest at the two PSCs in September 2011.
Under its agreements, CBM Asia will reimburse each vendor up to US$500,000 on the execution of a joint operating agreement (JOA), which is expected in the second quarter of 2012, and up to an additional $500,000 on the one-year anniversary of the execution of each JOA.
HULU PSC
CBM Asia entered into an acquisition agreement with PT Samantak Mineral Prima to acquire the right to earn an operating 70% interest in the Hulu PSC to explore and develop potential coalbed methane resources within an area encompassing approximately 519 km2 in Central Sumatra and has submitted an application to the Government of Indonesia to extend the Hulu PSC to approximately 1,983 km2.
The Hulu PSC is adjacent to the Trans Sumatra pipeline which supplies Singapore as well as domestic markets including Java and the Duri Steamflood, where Talisman Energy reported average gas delivered gas prices of $10.14 /Mcf during the Q3 2011 .
The Hulu Vendor conducted extensive geological study and contract proposal phases which form the basis of the commercial terms agreed to by Indonesia's upstream oil and gas regulator BPMigas in awarding the PSC including a joint evaluation study (the Study Phase) that included the acquisition and evaluation of extensive geological data such as existing facies maps, outcrop data, logs from existing conventional wells, and seismic data.
Under the Hulu Acquisition Agreement, CBM Asia as operator, is responsible for conducting the lesser of a maximum $6.5 million exploration and appraisal program or four core wells over the first three years to determine commercial feasibility of coalbed methane production and submit a Plan of Development to the Government of Indonesia for approval.
BENTIAN BESAR PSC
CBM Asia entered into an acquisition agreement with PT Ridlatama Mining Utama, to acquire the right to earn an operating 70% interest in the Bentian Besar PSC to explore and develop potential coalbed methane resources within an area encompassing approximately 830 km2 in East Kalimantan and has submitted an application to the Government of Indonesia to extend the Besar PSC to approximately 1,930 km2.
The Besar PSC is located approximately 133 km from the gas trunk line that connects to the Bontang LNG Plant and less than 80 km from CBM Asia?s Kutai West PSC. BP announced in August 2011 that coalbed methane produced from its joint venture Sanga Sanga PSC has been delivered to Bontang LNG since March 2011, resulting in the world?s first CBM-to-LNG export.
The Besar Vendor conducted extensive geological study and contract proposal phases which form the basis of the commercial terms agreed to by BPMigas in awarding the PSC including a joint evaluation study (the Study Phase) that included the acquisition and evaluation of extensive geological data such as existing facies maps, outcrop data, logs from existing conventional wells, and seismic data.
Under the Besar Acquisition Agreement, CBM Asia as operator, is responsible for conducting the lesser of a maximum USD6.5 million exploration and appraisal program or four core wells over the first three years, to determine commercial feasibility of coalbed methane production and submit a Plan of Development to the Government of Indonesia for approval. (alex)