Nido Petroleum mulls withdrawing from Cakalang, Baronang

By Romel S. Gurky

Australian firm Nido Petroleum announced on Friday it was considering wheter to continue or withdraw from two offshore blocks offshore Natuna, Cakalang PSC and Baronag PSC.

The operator of the PSC, Lundin Baronang BV, drilled the Balqis-1 and Boni-1 exploration wells within the PSC during the half-year. Whilst penetrating a full section of predicted reservoir intervals, both exploration wells were water bearing and were plugged and abandoned, Nido said in its half-year report.

?The company is currently in the process of reviewing the future prospectivity within the PSC ahead of a decision as to whether to continue or withdraw from the PSC,? it said.

During the first half of the year, the company exercised its option to increase its participating interest in the Baronang PSC from 10% to 15%. The increase in participating interest remains subject to regulatory approval. The remaning interest is owned by Swedish firm Lundin Petroleum.

The firm also said there was no activity within Cakalang PSC during the half-year. The results of the Balqis-1 and Boni-1 wells in the adjacent Baronang PSC have impacted the prospectivity of the Cakalang PSC which indicates the block may now have limited access to oil charge. Cakalang is also operated by Lundin.

?Nido is in the process of deciding whether to continue or withdraw from the block when it expires on 13 November 2014. There are no current commitments with respect to this PSC,? it said.

Early this month, Lundin said in its second quarter report that it planned to relinquish Cakalang and Baronang after failing to encounter commercial hydrocarbon.

Editing by Johannes Simbolon

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