Drilling of Paus-Biru 1 exploration well expected next year
Wednesday, October 25 2017 - 08:19 AM WIB
ASX-listed Cue Energy Resources Ltd said on Wednesday that the Paus-Biru 1 exploration well in the Sampang PSC, offshore East Java, is progressing towards approval by the joint venture, and potential drilling in 2018.
?The Paus- Biru-1 exploration well is in the final stages of Joint Venture approval,? Cue said in a statement.
In anticipation of final investment decision (FID) later this year, the Joint Venture has approved geophysical and geotechnical site surveys, which will be conducted during the December 2017 quarter, the company added. ?The Paus-Biru -1 well will target the Mundu gas reservoirs which are productive at Oyong and Wortel.?
Cue said perforation and testing of the Paciran (Upper Mundu) reservoir in the existing Oyong 5 and Oyong 9 wells will be undertaken during October. If successful, these new reservoirs have the potential to add the gas production at Oyong and expand the Joint Venture?s view of the total gas resource.
?Negotiations have been completed to extend the Wortel Gas Sales Agreement for approximately 3 years on substantially the same price as the existing agreement. This new agreement will be effective from approximately mid-November, when the sales volume under the current contract is reached,? Cue said.
The company said gas production from the Oyong and Wortel fields was reduced during the quarter due to the temporary reduction of compression associated with the removal of offshore oil facilities and replacement of the compressor at the Grati onshore processing plant. The new compressor is being transferred from another PSC and replaces a leased unit, which will result in lease cost savings for the life of the Sampang PSC.
Cue said the Sampang Sustainability Project and installation of onshore compression at Grati is 87 percent complete and is expected to be completed during the December 2017 quarter, resulting in significantly reduced operating costs. The project is proceeding on time and budget.
Santos is the operator of Sampang PSC with 45 percent interest. Singapore Petroleum Co. has 40 percent interest, and Melbourne-based Cue Energy Resources Ltd. holds the remaining 15 percent.
Editing by Reiner Simanjuntak