PRESS RELEASE: West Natuna gas scheme, Novus

Now in Service

Novus Petroleum Limited is pleased to announce the start up of the West Natuna Gas Scheme and West Natuna Transportation System (WNTS), ahead of schedule and within budget.

The project commenced service on 3 December 2000 and the first export of gas from the Kakap Production Sharing Contract fields in the West Natuna Sea into the WNTS pipeline took place on 6 December.

The Scheme

The scheme involves the supply of 2.3 trillion cubic feet of gas at a maximum rate of 325 million cubic feet per day via a 654 km pipeline system from gas fields in the West Natuna Sea in Indonesian waters to Singapore. Three Production Sharing Contract (PSC) joint ventures will be providing gas:

oBlock B operated by Conoco (who are also the project operator);
oBlock A operated by Premier;
oKakap, operated by Gulf Indonesia, has 20% of the WNTS. Novus has a 25% interest in the Kakap PSC.

Under Budget, Ahead of Schedule

Novus Managing Director, Dr Bob Williams commented: "The early start up is a credit to all those involved in the project. First gas sales under the West Natuna Project were originally scheduled for 15 July 2001.

"However, we are proud to announce that on completion of customer receiving facilities later this December, gas delivery into Singapore from the West Natuna Gas and Transportation Schemes can commence.

"The WNTS is forecast to be within the budget of US$372m (Novus share US$20.8m) and the Kakap specific work of the West Natuna Gas Scheme is currently estimated to be US$46m (Novus share US$11.5m) compared to a budget estimate of US$55m."

Novus' share of the total expenditure, including project planning, management and support costs, over the life of the project, is currently estimated to be US$37.5m.

Now in Service

Construction commenced with pipe laying on 20 January 2000 and from Novus' point of view can be considered as two sub-projects:

West Natuna Gas Scheme

The project involved the adaptation of the KF platform in the Kakap PSC to enable simultaneous gas and oil processing and production, plus well completions and pipelines to tie in three gas fields (KF, KH and KRA).

The gas processing and compression facilities were declared in service on 26 November 2000 and commenced re-injecting produced gas back into the reservoirs whilst waiting for the main pipeline of the WNTS to come on-line.

The KF platform commenced injecting gas into the WNTS main pipeline on 6 December at a rate of 9 million cubic feet of gas per day and a pressure of 400 psi.

West Natuna Transportation System

The West Natuna Transportation System will pipe the gas to customers in Singapore. The project was declared in service on 3 December 2000 with the commissioning of approximately 654km of pipeline after final drying and successful pressure testing.

The pipeline is now being filled with gas from the West Natuna Sea fields in anticipation of the commissioning of the receiving facility. This facility is owned by SembGas, the Singaporean gas consortium, and is due to be ready later in December.

Strong Production Portfolio Driving Value

The commencement of production of West Natuna Gas will add long-term value to Novus' already strong production from assets in Australia, Indonesia and the Middle East.

Novus' Managing Director, Dr Bob Williams, said: "The Kakap PSC is the most important of the assets we secured as part of our float portfolio. Back in 1995 it was an oil production block but with a substantial volume of unutilised gas. Five years later the Kakap PSC is being rejuvenated as a gas producing asset with two or three decades of life ahead of it. Together with our long-term producing assets in the Western Desert of Egypt and the Australian Cooper Basin, Kakap is becoming one of the strong pillars on which Novus' growth ambitions are based."

The participants in the Kakap PSC are: NOVUS PETROLEUM 25.00 percent; Gulf Indonesia Resources (Operator) 31.25 percent; Premier (Kakap) 18.75 percent; Singapore Petroleum Company 15.00 percent; Pertamina 10.00 percent.

Contact: Bob Williams 02 9299 4888 or 0412 631 818; Graham Monk 02 9299 4888 or 0412 224 009; http://www.novuspetroleum.com (*)