Salamander considers divestment of Kerendan field
Thursday, May 1 2014 - 12:57 PM WIB
UK firm Salamander Energy announced on Thursday it is considering selling several assets, including Kerendan gas field in Central Kalimantan, which is 70 percent and operated by the firm.
Besides, the firm considers selling its 100 percent stake in the Bulalang oil field in Thailand ?in line with its strategy of active portfolio management to realize value from its assets over time.
The company claimed it has received a number of preliminary and conditional expressions of interest in relation to the divestment of a portion or all of its interests in these assets and, in addition, a small number of preliminary and conditional approaches in relation to a potential offer for the entire share capital of the company.
Accordingly, the said it has engaged with a number of these interested parties with a view to conducting a review of the company's options, including a potential sale of the company.
Continuing discussions relating to a sale of the company are being conducted under the framework of a "formal sale process" under the City Code on Takeovers and Mergers, under which the Board of Salamander is able to continue having discussions with third parties interested in such a transaction on a confidential basis, the firm said.
The company expects the review to be concluded in the coming weeks.
The company has appointed Goldman Sachs International as financial adviser to conduct the formal sale process.
?The Board of Salamander reserves the right to terminate the formal sale process at any time and in such cases will make an announcement as appropriate. The Board of Salamander also reserves the right to reject any approach or terminate discussions with any interested party or participant at any time,? the firm said in a statement.
Greater Kerendan refers to the acreage position in Central Kalimantan, that is centered round the development of the Kerendan gas field. The Kerendan field which contains 120 bcf of 2P reserves and a further 160 bcf of contingent resource.
A gas sales agreement has been signed with PLN to supply 20 mmscfd to a new build power plant 3 km from the field. Four development wells were completed in the first half of 2013 and tested at a combined rate of 40 mmscfd which is comfortably in excess of requirement under the GSA.
The power plant will be able to handle three times the currently contracted volumes providing an opportunity to commercialize additional gas volumes currently in the contingent resource category, at an improved gas price.
The West Kerendan-1 well was completed in the first half of 2014 as a gas discovery and flowed at a rate of over 50 mmscfd. West Kerendan has certified contingent resource of 313 bcf with a further 50 bcf of upside from a second gas column.
There is follow on exploration potential in Greater Kerendan with numerous prospects in both the Upper Berai and Tanjung formations.
Editing by Johannes Simbolon