Sugih Energy secures $35 million contract

IDX-listed PT Sugih Energy, through its subsidiary PT Resources Jaya Teknik Management Indonesia (RMI) has won a tender worth US$53 million from Virginia Indonesia Co LLc (Vico) to conduct drilling works at the Sanga Sanga oil block in East Kalimantan, Kontan reported on Tuesday.

Andhika Anindyaguna, the president director of Sugih Energy, said in Jakarta on Wednesday that his company and Vico would sign the contract in April. According to the existing plan, the contract which would be valid in October, 2013, would last for three years.

RMI, 51 percent owned by Sugih Energy and 49 percent by PT Parwa Nusantara Technology, is also engaged in the procurement of drilling tools and in rig rental, in addition to the drilling service. At present, the company operates a rig to carry out exploration activities at the Akantara I well in the Lemang block, South Sumatra.

Andhika said that RMI planned to buy one more rig this year to support the expansion of its drilling works. ?Investment for the purchase of a US made rig reaches about $25 million,? he said, adding that the Chinese rig is generally cheaper at between $15 million and $20 million.

This year, Sugih Energy expects to book total revenues of about $35 million, a 363 percent increase from $7.56 million recorded last year. (*)