Cue Energy reports Indonesian operations
Tuesday, July 25 2017 - 12:43 AM WIB
Production
Sampang PSC- Madura Strait
Cue Interest: 15%
Operator: Santos (Sampang) Pty Ltd
Steady gas production continued from Sampang during the quarter, with the gross combined average production from Oyong and Wortel 51 mmcf/d and 497 bopd.
During June, oil production from the Oyong field ceased as part of the Sampang Sustainability Project (SSP). Work is continuing on the conversion to gas only production, which is expected to extend the life of the Oyong and Wortel fields by at least 2 years to 2020 or beyond.
Oyong Field
During the quarter Cue?s share of gas sales receipts was $2.42 million from the sale of 260 mmcf.
Cue did not receive any receipts for oil and condensate sales during the quarter but reimbursed US$0.39 million for overlift of 6,165 bbls in 2016. Revenue from final oil sales at Oyong are expected to be received in Q1 CY18 after reconciliation with Indonesian Government allocations.
The Oyong average oil production rate for the quarter was 497 bopd (gross) and the daily gas average rate was 21.5 mmcf/day (gross) (Cue net: 64 bopd and 2.5 mmcf/d - both net of government take under the PSC). There will be no further oil sales from the Oyong field. Oyong gas production is expected to be reduced over the next quarter while the conversion to gas only production is completed.
During the quarter, the JV reviewed the potential for new reservoirs to be tested above the producing Mundu sands. The operator has proposed new completions in Oyong 5 and Oyong 9 wells to test the Upper Mundu reservoir, which are likely to be undertaken during the current quarter
Wortel Field
During the quarter Cue?s share of gas sales receipts was $2.98 million from the sale of 318 mmcf. Cue did not have any condensate sales in the quarter.
Wortel-3 and Wortel-4 flowed gas at a combined average daily rate of 29.1mmcf/d (gross) during the quarter (Cue net 3.2 mmcfd net of government take under the PSC.)
Installation of a new compressor at the Grati processing plant has been initiated. The new compressor is being been transferred from another PSC and replaces a leased unit, which will result in lease cost saving for the life of the Sampang PSC.
Exploration
Mahakam Hilir PSC - Kutei Basin
Cue Interest: 100%
Operator: Cue Kalimantan Pte Ltd
During the quarter, a farmout process for the Mahakam Hilir PSC was initiated to attract a joint venture partner and Management presentations were conducted.
Cue?s focus has returned to the Naga Utara prospect in the northern area of the permit, where gravity gradiometry data identified a depositional environment which is analogous to the area which contains the Sambutan producing gas field.
Data analysis is focusing on the reprocessing of available seismic data and well analysis of recent and historical wells. The results are very encouraging and we are building up a structural and reservoir model of the area which can explain the higher prospectivity in the area and poor results in the Naga Utara 1 and 2 wells.
A key factor in the analysis is data available from the Sambutan-8 well, drilled in the 1930s, which is located inside the Mahakam Hilir PSC. This well encountered a gross 100m section of interpreted good quality reservoir sands with log responses that indicate the possible presence of hydrocarbons. The reservoir sands intersected by the Sambutan-8 well correlate to the producing Sambutan gas field, located approximately 200m west of the well. In the Mahakam Hilir PSC the sands have not yet been tested or put on production.
Cue has also hired a new General Manager Indonesia, who was previously the General Manager of SEMCO which operated the Sambutan field, and has significant knowledge of the area.
Further analysis of the Naga Selatan-2 well information, gravity gradiometry and shallow coring results indicate lower prospectivity in the southern area of the permit. As a result of this further analysis, plans are being made to plug and abandon the Naga Selatan-2 well.
Mahato PSC - Central Sumatra Basin
Cue Interest: 12.5%
Operator: Centralsumatra Energy
The Mahato PSC covers a highly prospective area, close to several large producing oil fields. Multiple appraisal and exploration opportunities have been mapped. The permit has a minimum work commitment of 1 well and 2D seismic acquisition by July 2018.
The Operator, Central Sumatra Energy, has advised Cue that all required permits have been received to enable the drilling of a well in the Petapahan area. Pending partner agreement and the signing of a JOA, a well could be drilled by Q1 CY2018.
In May, Bukit Energy, announced the sale of their equity to Bow Energy Ltd, a TSX listed company. (end of excerpt)