KOV Ups Stake in Brunei Block L
Kulczyk Oil Ventures (KOV) announced that a wholly-owned subsidiary of KOV, Kulczyk Oil Ventures Limited (KOVL), has entered in to a sale and purchase agreement with the receiver manager of AED under which KOVL has acquired all of the issued shares of AED Southeast Asia Limited (AED SEA) for a nominal consideration and increased its total interest in Block L to 90 percent.
The sole asset of AED SEA is a 50 percent operated interest in a production sharing agreement (Block L PSA) which gives it the right to explore for and, subject to the approval of a development plan, produce oil and natural gas from Block L in Brunei.
Block L is a 1,110 square kilometer (275,000 acre) exploration and development block covering certain onshore and offshore areas of Brunei. The size of Block L was recently reduced by 50 percent as part of the Phase 1 relinquishment process required under the terms of the Block L PSA. A 143 km2 3D seismic program is currently underway on Block L and two additional exploration wells will be drilled prior to the end of the Phase 2 exploration period of the Block L PSA.
Upon the closing of the acquisition of AED SEA, KOV will have a 90 percent interest in the Block L PSA with indirect wholly-owned subsidiary Kulczyk Oil Brunei Limited having a 40 percent interest and indirect wholly-owned subsidiary AED SEA (operator) having a 50 percent interest. The remaining 10 percent interest is owned by a private Brunei company at arm's length to KOV.
In addition to its interest in Block L, KOV owns a 36 percent interest in a production sharing agreement which gives it the right to explore for and, subject to the approval of a development plan, produce oil and natural gas from Block M in Brunei. Block M is a 1,505 square kilometer (372,000 acre) exploration and development block covering an onshore areas of Brunei to the south of Block L. The size of Block M was recently reduced by 50 percent as part of the Phase 1 relinquishment process required under the terms of the Block M production sharing agreement.