Sugih Energy budgets $25m capex, names new president
Friday, January 22 2016 - 01:31 AM WIB
IDX-listed PT Sugih Energy Tbk has budgeted US$25 million for capital expenditure (capex) this year, a significant increase from $6 million last year.
Company Director Ferdinand Terdy said on Thursday the $25 million capex is allocated for gas development in Lemang PSC (around $15 million) and gas development in Selat Panjang PSC (around $10 millon).
Program for Lemang PSC includes the development of three existing wells, preparation of Early Production Facility (EPF) and drilling of five to eight new wells.
Program for Selat Panjang PSC includes workover on existing wells to optimize production and drilling of new wells to meet obligation set in the gas sales and purchasing agreement.
?The funds have been prepared, 80 percent of which are bank loans and the rest raised internally,? he said.
The firm targets to produce 5000 bpd this year, Ferdinand said, while noting that the firm?s block development program will be adjusted to oil price movement.
?Our oil production cost is around $25 per barrel. If the price is above the cost, we shall carry out drilling. However, if the price is below the level, we shall put our development drilling on hold,? he said.
Elsewhere, during an extraordinary shareholders meeting Thursday, Sugih appointed Riyanto Soewarno as the company?s new President Director, replacing Andika Anindyaguna.
Riyanto said that the company?s main focus in the short term is gas development and increasing sales of gas amid the current oil price drop. ?Because of the oil price drop we?re slowing down, but it doesn?t mean we stop operation. We continue to carry out activities, although lesser, so that when the price rebounds, we?ll be ready,? he said.
Editing by Johannes Simbolon