Pearl Energy farms out Sebuku, Tungkal PSCs
Thursday, September 29 2005 - 06:02 AM WIB
Under the terms of the transaction for Sebuku PSC, Fuel-X will be responsible for 100 percent of the drilling costs for three exploration/appraisal wells in the PSC contract area, up to a maximum aggregate amount of US$12 million. PEARL Sebuku will remain as operator of the Sebuku PSC with a 50 percent of working interest.
For Tungkal PSC, Fuel-X will pay an aggregate purchase consideration of US$13,500,000; and be responsible for 100 percent of the well costs for an exploration well to be drilled in the PSC contract area, up to a maximum amount of US$1,500,000. PEARL?s effective interest in the Tungkal PSC will reduce to 70 percent from 100 percent and PEARL Tungkal will remain as operator of the PSC.
The Sebuku PSC lies in the Makassar Straits to the east of Kalimantan and covers an area of approximately 8,773 sq km. PEARL said it planned to commence a three well drilling program in the PSC by the end of 2005, however, it will depend on rig availability.
The Tungkal PSC contract area is located onshore Sumatra, Indonesia, and covers approximately 2,288 sq km. The primary asset in the Tungkal PSC is the Mengoepeh oil field, which began production in December 2004 and reached a production level of 2,100 barrels of oil per day at the end of the second quarter 2005.
According to PEARL, construction of the permanent production facilities in Mengoepeh is underway and is slated for completion by the end of 2005.
?In a high oil price environment as we see today, this transaction reflects our approach to sensible portfolio management and is consistent with our farm-out strategy to mitigate risk and, at the same time, retain a meaningful ownership position,? said Richard Lorentz, PEARL?s Chief Business Development Officer in a statement. (Robert)