Medco, Arrow sign deal on CBM project
Monday, March 12 2007 - 03:58 AM WIB
Australian company Arrow Global CBM Pty Ltd and PT Medco E&P Indonesia have signed a letter of understanding (LoU) for wide ranging corporation in about 1,200 square kilometers coal bed methane (CBM) area project in South Sumatra.
Under the terms of the LoU Arrow and Medco will perform a joint commercial and technical due diligence study of the area, and it is intended to complete the studies and sign a joint venture arrangement by the end of April 2007, Arrow said in statement Monday.
According to Arrow, pending the results of the study, both companies will finalize a commercial arrangement between the two companies to monetize CBM resource in the target area.
Consultant studies have estimated that the CBM resources of the South Sumatra basin contain up to 120 Trillion Cubic Feet (TCF). This agreement complements the agreement with PT Sugico Graha in the same basin, which was announced late last year, Arrow added. (denny)