Kambuna Field Development
In the Glagah-Kambuna Technical Assistance Contract (TAC) area, Serica is developing the Kambuna Field on behalf of its partners and the Indonesian state oil and gas company, PT Pertamina Persero ("Pertamina"). The first production from the field remains targeted for 2008 at initial rates of approximately 50 million cubic feet per day of gas and 5,000 barrels per day of condensate.
Engineering design studies for the gas export pipeline are being carried out by Wood Group and the project schedule is being finalized with a view to full project sanction being given prior to year end. Serica is working with Pertamina to determine the optimal route for the pipeline for gas and LPG sales into the Medan area in north Sumatra. Condensate (very light hydrocarbon liquids separated from the gas and sold as oil) will be stored in a Floating Production, Storage and Offtake vessel (FPSO) and loaded into shuttle tankers offshore for sale to international markets.
Tanjung Perling Field Development
In the adjacent Asahan Offshore Production Sharing Contract (PSC), the Indonesian oil industry regulatory authority ("BPMigas") has requested further technical information with respect to the marginal Tanjung Perling Field, which Serica proposed to develop as an incremental project to the Kambuna Field. There may be insufficient time to satisfy the request of the regulatory authority prior to December 16, 2006, when the exploration period of the PSC would otherwise expire. Serica and its partners are holding constructive discussions with BPMigas to agree a mutually satisfactory means to bring gas from the Asahan Offshore PSC to market and ensure continuing operations on the block.
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