Cue says FEED for E. Java Oyong field completed

Australian listed oil company Cue Energy Limited said Wednesday that front end engineering and design (FEED) for the development of the Oyong oil and gas field offshore East Java had been completed.

?Engineering, procurement, construction and installation (EPCI) contracts have been released for bidding, with bids expected in February 2004,? Cue said in its half-year report.

The Oyong field, located in the Sampang PSC, was discovered in August 2001 and has over 90 BCF of proven and probable gas reserves and conservatively estimated reserves of 5 million barrels of recoverable oil.

According to Cue, a revision of Oyong plan of development was submitted to the Indonesian authorities. Approval is expected early in 2004.

Oyong field will be develop to use a manned Well Head Platform, 2 sub vertical gas wells and 3-5 horizontal oil wells. Oil and gas will then transported through a 14-inch x 60-km multi phase pipeline with a total capacity of 60 million cubic feet per day and 10,000 barrels per day.

Platform location and pipeline route surveys and seafloor boring has been completed and environmental impact studies are almost completed, Cue added.

Australian Santos Limited operates the PSC with 45 percent working interest, while Elspaso and Cue hold 40 percent and 15 percent, respectively.

Last July, the joint venture signed a gas sales agreement with PT Indonesia Power for a minimum of 40 million cubic feet of gas per day for up to ten years for the entire reserves of the Oyong field to fuel the latter?s Grati power plant.

First production from the field is expected to commence in the second half 2005. (robert)