Oilex Ltd. has entered into an agreement to acquire an additional 15% working interest in the West Kampar PSC (Production Sharing Contract onshore Sumatra, Indonesia) from PT Sumatera Persada Energi (SPE), thereby increasing Oilex's working interest from 45% to 60%. The West Kampar PSC area contains the Pendalian oil field with emerging production in 2008 and a number of highly prospective geological trends that
The consideration for the additional 15% interest includes Oilex carrying certain operational costs for SPE and a phased cash payment. The carried costs incurred by Oilex on behalf of SPE will be recovered preferentially by Oilex from production revenues.
On receipt of approvals from the Government of Indonesia and fulfilment of certain other conditions precedent, the participating interests (PI) in the West Kampar PSC will be:
Joint Venture Party Current PI New PI
West Kampar PSC - The contract area is located in central Sumatra adjacent to the most prolific onshore oil producing province in Indonesia. Awarded in October 2005, the PSC work program commitment provides for the acquisition of 250 kilometers of 2D seismic and 50 square kilometers of 3D seismic along with drilling of the Pendalian-3 well and an additional 4 exploration wells by November 2008.
A Plan of Development (POD) for Pendalian Field is being reviewed by the Indonesian Government as part of the approval process that should result in production from the field, initially from two wells, later in 2008. The POD is based on a recent Best Estimate resource of 13.7 million barrels oil-in-place (mmstboip). The represents an increase of 14% on the original resource estimate which was based on a single oil reservoir. The POD is designed to bring Pendalian Field into production in two phases comprising two wells in Phase 1 and full field development of 3-4 wells in Phase 2.
The original plan was to start production at a likely rate of about 1,200 barrels of oil per day from a single well, Pendalian-3. That first phase may now be expanded to include a second well, Pendalian-4, with a corresponding increase in the likely production rate to 1,800 - 2,000 bopd (100% basis) in Phase 1 of development, anticipated during Q4 2008.
The opportunity to increase its stake in Pendalian Field and West Kampar PSC will add to Oilex's near-term potential oil production as it expands its asset portfolio of low risk exploration, appraisal and development projects around the Indian Ocean rim.
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