Pan Orient Energy Corp. has provided highlights of its 2008 fourth quarter and 2008 year-end consolidated financial and operating results. Please note that all amounts are in Canadian dollars unless otherwise stated.
Pan Orient's base capital budget for 2009 will be approximately $60 million, with 57% directed towards exploration and development in Thailand and 43% high grading exploration opportunities in Indonesia. The base 2009 capital program includes the following:
Capital program of $34 million that includes the drilling of 29 wells. Exploration and development activity will continue in Concession L44/43 (operator and 60% working interest owner) with the drilling of 25 wells, site upgrades and workovers. In addition, there is expected to be two exploration wells drilled in Concession L33/43 (operator and 60% working interest owner) and two exploration wells drilling in Concession L53/48 (operator and 100% working interest owner).
Capital program of $26 million that includes 500 kilometers of 2D seismic in the Batu Gajah PSC, and 1,250 kilometers of 2D seismic in the Citarum PSC to bring exploration prospects and leads on those concessions up to drill ready status.
In addition to the stated capital budget of $26 million for Indonesia, there will be a contingent budget of an additional $7 million related to the cost of long lead time drilling equipment and the potential drilling of one exploration well in late 2009.
Sawn Lake, Canada
No capital expenditures are planned by Andora for 2009.
The $60 million capital program for 2009 will be funded through utilizing the $46.4 million of working capital and deposits at December 31, 2008, plus an additional $5.4 million of equipment inventory on hand at the beginning of 2009, and through cash flow generated from the Thailand operations.
The 29 wells Pan Orient plans to drill on three company operated concessions will utilize two drilling rigs which are under long term contract. At least two wells are planned on the 100% working interest L53/48 concession starting in October 2009. The remainder of the Thailand drilling program in Concession L44/43 and L33/43 will focus on the continued development of the NSE field (south and central), appraisal at NSE-E1, NSE north, Na Sanun, NSE-F1 and up to four exploration wells in the Bo Rang and Si Thep areas.
The 2009 program is intended to strike a balance between development drilling targeting new production, and exploration defining potential new reserves. The goal is to reach and hold production in the range of 7,200 to 9,000 barrels per day net to Pan Orient (12,000 to 15,000 barrels per day gross) by the third quarter of 2009 and add proven and probable reserves of 12 million barrels net. Any exploration success will be evaluated after initial appraisal drilling as to the impact on production targets with updated guidance provided by the company at that time.
At the Citarum PSC located onshore Java (operated and 69% working interest) a 2D seismic program is currently underway, with the initial 750 kilometer program approximately 25% complete. Upon completion of this initial 750 kilometer program, an additional 500 kilometers of infill 2D will be acquired in order to convert leads defined in the reconnaissance program into drillable prospects. All seismic operations are anticipated to be completed by year end with drilling anticipated in the second quarter of 2010.
At the Batu Gajah PSC located in South Sumatra (operated and 90% working interest) a 2D seismic program is planned to commence within the next 2 months with 500 kilometers of 2D data to be acquired over five prospects and leads defined on pre-existing data. It is anticipated this program will be completed late in the third quarter of 2009 with the drilling of 3 exploration wells to commence in the first quarter of 2010 with a possibility of the drilling of the first well starting in late 2009.
Sawn Lake, Canada
Andora is currently waiting on approval from the Alberta Energy Resources Conservation Board (ERCB) to build and operate a Steam Assisted Gravity Drainage (SAGD) demonstration project. The proposed project includes a single well pair designed for peak anticipated production rates of 750 barrels per day. Given the current oil price environment it is most likely the decision by Andora to proceed with the demonstration project will be deferred into 2010.
Most Popular Articles