NZOG: FID for Kisaran block expected before end 2014
Tuesday, August 26 2014 - 02:28 AM WIB
ASX-listed New Zealand Oil and Gas Ltd (NZOG) said that a plan of development (POD) is being finalized for the Kisaran wells in onshore North Sumatra, with a final investment decision (FID) expected before the end of 2014.
?If a final investment decision is made later this year, production will begin next year. It would involve a series of low cost wells each accessing a modest resource,? the company said in a filing with the ASX Tuesday.
NZOG has 22.5 percent interest in the Kisaran block. Operator Pacific Oil & Gas has 55 percent interest with the balance held by Bukit Energy.
The block?s partnership in 2013 made discoveries through the drilling of Parit Minyak-1, Parit Minyak-2 and Parit Minyak-3 wells.
NZOG said that the plan of development is being worked through with the industry regulator in Indonesia.
?The plan of development has been drafted and it?s being worked through with the regulator. In a production sharing contract, the joint venture gets 85 per cent of the revenue from the field until it has been able to recover its development costs (and a margin). After that it receives 15 per cent of the production profits. So you can see that the regulator has a strong interest in the cost of development, and it has to be worked through,? the company explained.
Editing by Reiner Simanjuntak