Medco spends US$7.15m on Bengara-1 PSC exploration

IDX-listed oil and gas company PT Medco Energi Internasional Tbk. said it has spent a total of US$7.15 million on the exploration of Bengara-1 Block PSC, which is located in North East Kalimantan.

In its public disclosure to the Indonesian Stock Exchange, the company said it spudded South Sebuku-2 well in the block on June 17, 2011. It planned to drill a total depth of 4,535 feet. As of end July 2011, it has drilled to a total depth of 4,546 feet.

At interval of 2,897-2,902 feet, there was a gas flow of 3,609 MMSCFD.

The company said it will continue the testing at interval 2000.5-2011.5 feet and 1,499-1,516 feet.

The Bengara-I Block was originally awarded to PT Petroner Bengara Energi. PT Medco E&P Bengara, a subsidiary of Medco Energy, took over 100 percent interest on September 27, 1999. The company currently holds 58.33 percent of working interest, while Salamander Energy holds 41.67 percent interest. The PSC is valid until 26 September 2029.

Medco also updated investors about the progress of the Rimau Block in Musi Banyuasin in South Sumatera and South & Central Sumatra Block PSC.

Medco said it has spudded Taba-1 well in Rimau Block on September 10, 2011 and planned to drill a total depth of 679 feet.

As of the end September 2011, the company drilled a total depth of 580 feet. However, the drilling has not shown results yet. The next plan is to continue logging job.

Medco has spent US$570,270 for drilling as of end September.

The company also conducted 2D land seismic acquisitions in Banyuasin and Musi Banyuasin regencies, with total track 400 km. The seismic produces no results yet.

The next plan is to continue topography survey and drilling. The company has spent US$431,821 for the seismic activities.

Medco holds 95 percent interest in Rimau Block and the balance is held by Perusahaan Daerah Pertambangan & Energy Sumsel. The block was originally awarded to PT Stanvac Indonesia which shares were 50 percent Exxon and 50 percent Mobil Oil. PT Medco E&P Indonesia took over 100 percent interest from the original shareholders on December 22 1995.

As for South and Central Sumatra Block PSC, Medco said it has temporary suspended the well drilling following discouraging results while the company has spent US$1.276 million on the work.

The company spudded Lica-2 well in the block, on August 26, 2011 with total depth target of 4,826 feet. As of end September 2011, it drilled to a total depth of 4,912 feet.

Based on the capacity test at interval 4,578-4,588 feet, there was 8.1 barrels of fluid per hour with 0 percent of water cut. (roffie)