Matrix begins flowing oil from N. Sumatra field

Matrix Oil NL on Wednesday announced that it had begun flowing oil from its 90 percent-owned Langsa Technical Assistance Contract (TAC) area in the Offshore North Sumatra Basin of Indonesia.

Matrix has two wells coming into production, the L1 and L2, that will gradually be opened to full pressure over the "startup" period of the next few days.

The Langsa oil field should stabilise at a total final flow rate of between 8,000 - 8,500 barrels oil per day (BOPD) from the two wells, generating gross annual revenue of about US$55 million with an average oil price of US$18 per barrel.

Matrix Managing Director, Brian Hockney, said that the L1 well was opened to begin flowing just before midnight last night into the "MV8 Langsa Venture" - the Floating Production Storage and Offload (FPSO) vessel anchored onsite.

The L1 well has been opened up to stabilise first, with the L2 well expected to come on stream over the next day.

During initial flow tests last month, when the two wells were re-entered and opened up by the semi-submersible drilling rig "Sedco 601", the L1 well flowed at a rate of 4,200 BPOD, and L2 flowed at 3,637 BPOD.

"The break even point for Matrix with production at 8,000 BPOD is an oil price of about US$11 per barrel," said Hockney.

Matrix planned to bring into production the third "H3" well early next year to increase production to about 10,000 BPOD. Flow lines have already been laid from the wellhead to the "MV8 Langsa Venture" FPSO for tie in when re-entry of the third well is completed.

The "MV8 Langsa Venture", which was anchored on site early this month for pre-testing ready for commissioning is capable of storing up to 230,000 barrels of oil, equivalent to about three weeks of production from the Langsa contract area. (robert)