Ophir completes construction of Kerendan gas plant

By Romel S. Gurky

UK-based firm Ophir Energy Plc said it has completed the construction and commissioning of production facilities at Kerendan gas field in Bangkanai PSC, Central Kalimantan, last year.

The company said in a statement last week that at the end of the year the company supplied a small quantity of commissioning gas to a power plant of state-owned electricity firm PT PLN.

?We forecast that low rate commissioning activities will continue into the second half of 2016, at which time the plant will start full production of phase 1,? the company said in the statement.

Ophir said that agreement has been reached with PLN to amend the Gas Sales Agreement (GSA) to set the commercial start date as January 11, 2016 with Take or Pay on the initial GSA applicable from this date.

?There is little progress to report so far in revising upwards the price of the gas; the negotiation is taking longer than hoped due to regulatory processes that have had to be completed prior to the gas price being finalised,? it said.

?We expect these processes to conclude during 2016 and to yield an improvement to the current gas price. In the meantime, as part of the amendment to the GSA, the inflation mechanism was amended from 3 percent every three years to 3 percent per annum,? Ophir added.

The Kerendan field contains 120 Bcf of 2P reserves and a further 160 Bcf of contingent resource. Ophir owns 70 percent of Bangkanai PSC through Salamander Energy, which was acquired in November of 2014.

Editing by Reiner Simanjuntak