Serica Energy farms out N. Sumatra exploration blocks

Canadian junior oil firm Serica Energy Corporation anounced Tuesday today announced that it has entered into agreements with Duinord Petroleum Inc. to farm-out an interest in the Asahan Offshore Production Sharing Contract and the Glagah Kambuna Offshore Technical Assistance Contract, both are located in the northern part of Sumatera.

According to the company, subject to the necessary government approvals, Duinord will participate in the upcoming two well drilling program and will acquire a 25% working interest in both blocks. In consideration Serica will receive approximately US$1 million in back costs and 50% of the cost of drilling the first two wells.

No details are given about Duinord Petroleum.

Following completion of the two well program, Serica will retain a 40% working interest in the Asahan PSC and a 55% working interest in the Glagah Kambuna TAC and remain operator of both blocks.

The two well program is scheduled to commence during the second half of August with the drilling of the Kambuna-2 well in the Glagah Kambuna TAC and immediately thereafter with the drilling of the Togar-1A well in the Asahan PSC. (*)