Under the terms of the transaction, AWE will be responsible, among other items, for the drilling costs for the first two exploration wells in the Bulu PSC contract area, up to a maximum aggregate amount of US$12 million. In addition, the transfer is conditional upon the written consents of the government of Indonesia and the Indonesian oil and gas regulator, Badan Pelaksana Kegiatan Usaha Hulu Minyak Dan Gas Bumi.
Once the transaction is approved by relevant authorities, Aabar's interest in the Bulu PSC will reduce to 42.5% from 85% and Aabar will remain as operator of the Bulu PSC. The remaining 15% participating interest in the Bulu PSC is held by PT Satria Energindo with 10% and PT Satria Wijaya Kusuma with 5%.
The drilling campaign is anticipated to commence in the third quarter of 2007. The Bulu PSC covers an area of 3,495 square kilometers and is located off the northeast coast of East Java in the East Java Sea.
"This transaction continues our strategy of securing partners at the exploration stage of a project to fund the drilling program in return for an interest in the block. This is how we mitigate risk to Aabar's shareholders," said Chris Gibson-Robinson, Aabar's Vice President Operations and New Business Development (Southeast Asia).
Aabar is an oil and gas exploration, production and drilling company headquartered in Abu Dhabi and is a public joint stock company listed on the Abu Dhabi Securities Market. Aabar has two divisions, Dalma Energy, which is focused on drilling operations, and Pearl Energy, which is engaged in exploration and production in Southeast Asia. Aabar's net working interest production currently stands at more 20,000 barrels of oil per day from four fields in Indonesia and Thailand.
The group plans to drill 10-15 exploration wells in 2007.
AWE is a wholly owned subsidiary of Australian Worldwide Exploration Limited, an Australian oil and gas exploration and production company.
PT Satria Wijaya Kusuma is a company incorporated in Indonesia and whose shareholders are Mr Wisnu Suhardono and Mr Gunawan.
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