Santos plans 2006 drilling campaign to appraise E. Java discovery

Australian oil firm Santos Limited will undertake 3-4 wells drilling campaign commencing early next year to further appraise Jeruk oil discovery in Sampang PSC offshore East Java.

The company said in a presentation material field with the Australian Stock Exchange Wednesday that it would begin with drilling of Jaeruk-3 well, which would appraise the western culmination of the field. Santos also said it had commenced development studies to bring the discovery into early production and would likely to use phased development approach to reduce reserve uncertainty and to optimize full field development.

Jeruk-2 well flowed 7,488 barrels of oil and 2.21 million cubic feet of gas per day on test last year. Preliminary estimates by Santos put the recoverable reserves number at 170 MMBO.

Several sidetrack drillings to appraise the discovery failed to determine the size of the oil pool.

Santos is the operator of Sampang PSC with 45 percent working interest with Singapore?s SPC and Australian firm Cue Energy hold the 40 percent and 15 percent, respectively. A company owned by East Java provincial government is in the process of acquiring 10 percent interest in the block.

Elsewhere, Santos said it was currently drilling Nyari exploration well in Madura Offshore PSC. Santos has 75 percent interest in the block.

Santos is planning 8 well exploration drilling campaign in Indonesia in 2006.

Santos is set to produce around 170 MMCFD of gas from its East Java?s Oyong field in Sampang PSC and Maleo field in Madura Offshore PSC when both projects had become onstream in 2007. Oyong is also set to produce oil at rate of slightly below 10,000 BPD from Oyong in 2007.(alex)