Lundin Petroleum to acquire Serica's interest in Lematang block

Swedish oil firm Lundin Petroleum AB said Tuesday it had signed an agreement with Canadian company Serica Energy plc to acquire Serica?s 10 percent interest in the Lematang block onshore South Sumatra, for US$5 million.

?Completion of the transaction is subject to all government and partner consents and is subject to partner pre-emption,? Lundin said in a statement.

Lundin is currently holds 15.8824 percent of working interest in the Lematang block together with the operator PT Medco Energi Internasional Tbk (74.1176 percent) and Serica (10 percent).

The Lematang block contains the Singa gas field with gross reserves of 125.4 billion standard cubic feet (Bscf) of gas which is expected to come on stream in 2008. The forecasted plateau (sales) gas output is 50 million cubic feet per day.

Medco has signed a heads of agreement for the sale of gas from the block with state-owned gas distribution company PT Perusahaan Gas Negara. The natural gas will be transported through the South Sumatra - West Java phase 1 pipeline. (Robert)