NuEnergy updates Indonesian CBM projects
Thursday, October 31 2013 - 07:29 AM WIB
NuEnergy continued with its operations at its Muara Enim Production Sharing Contract (PSC) Pilot Production Site in South Sumatra, Indonesia. Muara Enim Pilot Well # 1 continues to produce water and flow gas. The company increases its knowledge of the flows by assessing the results.
NuEnergy was pleased to announce recently the commencement of drilling of the second pilot well (Pilot Well # 2). During the quarter the rig was mobilised to the site and drilling commenced in early October. Drilling completion, permeability testing and lab results are expected in the next quarter. After the findings from the lab results the company aims to upgrade resources, book reserves and sell first pilot gas within the next six months.
Muara Enim PSC (NGY Participating Interest 100%)
ME Pilot Well # 1
Dewatering operations at the Pilot Well #1 production site have been under way and producing gas for six months with gas production steadily increasing. Aurecon is completing engineering work for the conversion of the pilot production site to a production and sales facility. First booking of revenue is being targeted within the next six months.
While at an early stage, NuEnergy continues to monitor water and gas flow rates at Muara Enim PSC by:
- Tracking the desorption forecast since May 2013;
- Producing methane in gas content in excess of 97%; and
- Producing water with less than 2,500ppm salinity.
It is likely gas and water production will exceed past results as gas production recommenced at higher rates and within two hours of the commencement of dewatering operations gas was flared.
ME Pilot Well # 2
During the quarter, NuEnergy was pleased to announce that the CNM drilling rig for NuEnergy?s second pilot well (Pilot Well #2) was mobilised at the Muara Enim Production Sharing Contract (PSC) Pilot Production Site in South Sumatra, Indonesia.
Mobilisation of the rig commenced on 26 August 2013. Located approximately 500 metres from Pilot Well #1, the second pilot well will be drilled and cased to 800 metres depth. The primary coal seams are located between 558 and 705 metres below the surface level.
NuEnergy will use radial jet technology to complete extended laterals across the significant upper coal seams and utilise pre-perforated slotted linear casing over the lower coal seams to maximise access to the productivity of those seams.
NuEnergy is targeting to log, permeability test and radial jet over 31 metres of Mangus and Suban coal seams, with the laterals extending outwards from between 30 and 50 metres from the well casing.
Upon completion of Pilot Well #2 well tubing, a PCP pump and a pump drive unit will be installed and the well connected to the pilot production plant located at the Muara Enim Pilot Well #1 site for the commencement of dewatering operations and build-up of gas production.
South Sumatra ? Well Re-entry program
NuEnergy continued discussions with our PSC joint venture partner, PERTAMINA during the quarter to gain approval for the testing of abandoned conventional oil and gas wells within the Company?s PSCs. The application has been received by PERTAMINA and industry regulator SKKMIGAS. Testing of abandoned wells as compared to drilling and testing is likely to lead to significant cost savings across all of NuEnergy?s PSCs? and generate basin wide understanding of all coal seams that can produce gas.
The Company commenced reviewing the logs of these abandoned wells. Reviewing the logs of these wells and testing them will assist the company in identifying underlying conventional oil and gas structures such as anticlines which may act to stimulate higher gas content and permeability.
Rengat PSC (NGY Participating Interest 100%)
Rengat PSC is located in the central Sumatra coal basin. The PSC covers an area of 3,000 square kilometres and is in the vicinity of a major gas pipeline from Jakarta to Duri and related infrastructure. NuEnergy has a 100% interest and continues to seek partners in the PSC to balance the portfolio and source funds for other exploration and development activities. (end of excerpt)