CITIC Commences Oil Production at Oseil-28 Well in Seram (Non-Bula) PSC

Australia's Lion Energy Ltd. announced Monday that the Oseil-­28 development well in Seram (Non-Bula) Production Sharing Contract (PSC) in eastern Indonesia has been completed as a producer with final clean-­up rates prior to rig release of approximately 640 barrels of oil per day (bopd) on a 20/64 inch choke. Total field production has been boosted by 18 percent to approximately 4,000 bopd. The Oseil-­22 development well is the next well planned in the ongoing development drilling program.

The Oseil-­28 well was spud July 18 and the rig was released Sept. 9. Excluding mobilization and rig up time, the well was drilled, completed and tested in 53 days, 34 days less than the well program projection.

Preliminary well costs indicate the well was drilled approximately $2.25 million under the budget projection of $9.955 million.

Commenting on the outcome of the Oseil-­28 well, Lion CEO Kim Morrison commented: “This is a very good outcome for the Seram joint venture, continuing the positive results of drilling on the north flank of the Oseil-­2 field area and setting a new benchmark for future development drilling cost. The operator CITIC Seram Energy Ltd. is to be congratulated on the outcome.”

Oseil-­28 reached total depth (TD) of 7,700 feet (2,347 meters) measured depth (MD) (6,394 feet or 1,949 meters total vertical depth or TVD) in the Manusela limestone objective and was completed with an electric submersible pump (ESP). This is the fifth well of the approved 10 well Phase 3 development plan approved for the Oseil-­2 area, and follows the completion of the successful fourth well in the program, the Oseil-­27 well, which is now flowing at a stabilised rate of in excess of 700 bopd.

Production from the Oseil and surrounding fields lifted to approximately 4,010 bopd (Lion equity share 100 bopd) with Oseil-­28 on stream. This rate has been temporarily reduced to approximately 3,820 bopd due to the requirement for an ESP replacement on Oseil-­12. This work is expected to be completed shortly.

The next planned well in the development program is Oseil-­22, also within the Oseil-­2 field area.


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