Kerendan on schedule to produce first gas in 3Q 2014

By Romel S. Gurky

UK oil and gas firm Salamander Energy Plc announced on Thursday that the Kerendan gas field in Bangkanai PSC in Central Kalimantan remains on schedule for first production at the end of third quarter of 2014.

?Following completion of the initial Kerendan development drilling campaign, Salamander and the Indonesian regulator have begun the process of re-certifying field resources with a view to ultimately agreeing additional gas sales volumes beyond the current Gas Sales Agreement,? the firm said in a statement.

The firm referred to the Gas Sales and Purchase Agreement (GSPA) signed by the firm together with state owned electricity firm PT Perusahaan Listrik Negara (PLN) on June 28, 2011, under which the British firm agreed to supply PLN?s power plant in Centrral Kalimantan with 130 trillion British thermal unit (tbtu) of gas over a period of 20 years.

Salamander also said on Thursday that it is contemplating issuing up to US$150 million of senior unsecured callable bonds maturing in 2020. The net proceeds will be used for general corporate purposes of the group including refinancing of the existing debt including the $50 million under the Kerendan bridge facility and (at Salamander?s discretion) up to $100 million of the convertible bonds

Salamander is the operator of the Bangkanai block with a 70 percent interest, while the remainder is held by PT Saka Energi Indonesia, a unit of Indonesia?s state-owned gas distribution firm PT Perusahaan Gas Negara (PGN).

Editing by Johannes Simbolon