KrisEnergy Bucks the Trend, Continues Projects

KrisEnergy Bucks the Trend, Continues Projects
It is business as usual for KrisEnergy despite low oil prices as the firm presses on with field development projects in Southeast Asia.

Singapore-listed KrisEnergy Ltd. is bucking the low oil price trend and progressing with a number of new field developments in Southeast Asia.

It has submitted a development plan for the Rossukon field in the Gulf of Thailand and reached an agreement with Cambodian authorities to develop the Apsara field.

Over in Indonesia, preparation for the engineering, procurement, construction and installation (EPCI) contract is underway for the Lengo field development, while supporting its partners in developing hydrocarbon resources from onshore Block A Aceh.

Staying Focused

KrisEnergy is holding up well despite the tough market conditions as it has sufficient funds to progress its projects. Formed in 2009, it has secured 19 contract areas – including 13 as operators – in Bangladesh, Cambodia, Indonesia, Thailand and Vietnam and made more than two dozen hydrocarbon discoveries to date.

In August, KrisEnergy completed a $119.05 million (SGD 169.5 million) renounceable underwritten rights issue, of which 85 percent of the net proceeds of $116.31 million were earmarked for development activities at existing and new fields.

Richard Lorentz
Richard Lorentz, KrisEnergy’s director of Business Development
KrisEnergy’s Director of Business Development
Source: KrisEnergy

“There is no doubt that 2014 and 2015 have been very challenging for the upstream sector and all the related industries such as rig companies and service providers,” Richard Lorentz, a founding director of KrisEnergy and director of Business Development, told Rigzone.

“However, at the beginning of 2014 we started to adjust our capital structure to strengthen our balance sheet. That meant the redemption of a high-yield U.S. bond followed by the issue of two Singapore dollar-denominated bonds later in the year, which effectively halved our cost of debt,” he added.

“The bonds, together with the rights issue this year, mean that our gearing is now around a manageable 35 percent and we have been able to focus on the job at hand to bring on stream the two near-term oil developments in the Gulf of Thailand. These are now producing and we expect to complete development drilling by the end of 2015 when we should reach plateau production at both fields of around 10,000 barrels of oil per day (bopd) each,” Lorentz explained. 

Optimism about KrisEnergy’s prospect have drawn strong support from the investor community, including Singapore’s Keppel Corporation Ltd., which holds 38 percent interest in the firm.

Busy in Core Growth Area

KrisEnergy has been active in its core growth area in the Gulf of Thailand. It submitted a development plan for the Rossukon area in Block G6/48 in June after drilling two successful exploration wells and two sidetracks in the first half of this year.

TEN Project Facts
Aerial view of Wassana infrastructure in the Gulf of Thailand, comprising the MOPU Ingenium and the Rubicon Vantage FSO
Source: KrisEnergy

Over at the Wassana field in the G10/48 contract area, where first oil commenced in August, KrisEnergy is adding 14 producer wells and one water disposal well to bring it to peak production of around 10,000 bopd by year end. KrisEnergy has also kept busy in Wassana with three finds – Niramai and Mayura, discovered in 2009, and Rayrai in 2015.

TEN Project Facts
Another view of the Wassana infrastructure
Source: KrisEnergy

Elsewhere in the Gulf, Nong Yao, KrisEnergy’s first development project, has been in production since June, while the company also holds non-operated working interests in the B8/32, B9A and G11/48 producing blocks.

In neighboring Cambodia, KrisEnergy’s attention centered on Block A, where 23 of the 24 drilled wells have encountered hydrocarbons, mostly oil. Formal paperwork is being drafted to develop the Block’s Apsara field, with first oil targeted to flow 24 months after the final investment decision has been declared.

The first phase development for Block A comprises a single platform producing to a production barge with a plateau production rate of 8,000 bopd. Once reservoir performance is measured and reviewed over a period, there is a potential for adding nine additional platforms in the Apsara area.

KrisEnergy Working on Lengo Project in Indonesia  

KrisEnergy operates seven of the eight blocks in Indonesia it has stakes in, with these acreages a combination of near-term development, discoveries requiring appraisal and high-impact exploration.

Near-term focus is on the two gas developments: the KrisEnergy-operated Lengo field in the Bulu Production Sharing Contract (PSC) offshore East Java, and the PT Medco E&P Malaka-operated Block A Aceh project onshore Sumatra.

Lengo’s geophysical and geotechnical surveys have been completed at the well-head platform location, the pipeline route and at the site of the onshore receiving terminal. Front-end engineering and design is almost completed for the Lengo facilities in the 269-square mile Bulu PSC, which lies in water depths of 164 to 197 feet.

Preparation for the EPCI contract is ongoing for the development which includes four wells, an unmanned wellhead platform, a 20-inch 40 mile export pipeline and an onshore receiving facility. First gas from Lengo, with production to plateau at 70 million cubic feet per day, is expected two years after the FID is made.

KrisEnergy also operates neighboring Sakti PSC, where it plans to drill a prospect later this year based on data acquired from 2D and 3D seismic which it has already processed and interpreted.

If the exploration well is successful, there is potential for Sakti gas to be produced through the Lengo facilities, which would follow up on the firm’s strategy of gas aggregation in Indonesia where possible.

Over in Sumatra, KrisEnergy together with partners is supporting operator Medco in the development of Block A Aceh which has several gas condensate discoveries including the Alur Rambong, Alur Siwah and Julu Rayeu fields. First gas condensate from Alur Rambong is anticipated in 2017, while the block’s Matang gas discovery requires further appraisal.

Vietnam and Bangladesh – KrisEnergy’s Next Frontier

Elsewhere in the region, KrisEnergy has a foothold in Vietnam and Bangladesh. In Vietnam, KrisEnergy holds stakes in three offshore exploration blocks, comprising Block 105-110/04 and Block 115/09, where it is the operator, and Block 120, where ENI S.p.A. is the operator.

The Block 120 joint venture is currently integrating 3D seismic data acquired in April 2015 with those collected in an earlier 3D seismic survey in 2012. Well results from the 1993-drilled 120-CS-1X exploration well and the Ca Ngu-1 well drilled in 2013 confirmed the existence of a petroleum system in the area.

Over in Bangladesh, KrisEnergy and Australia’s Santos Ltd. are analyzing 1,955 miles of 2D seismic data on offshore SS-11 block that was acquired in January.



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