Tap Awarded Block M in Brunei
Tap Oil reports that PetroleumBRUNEI has awarded Tap a 40% interest as operator in the Block M Production Sharing Contract, onshore Brunei.
Block M covers an area of approximately 3,100 square kilometers and is located in the Baram Delta, a world scale hydrocarbon province containing billions of barrels of oil and trillions cubic feet of gas. Block M is contiguous with and adjacent to the huge coastal and offshore oil and gas fields operated by Shell. The Block contains the Belait field, but is under explored having not seen any concerted exploration effort for many years.
The Belait oil and gas field located in Block M was discovered by Shell in 1914. This field has a number of wells drilled on it and has produced both oil and gas to the surface but remains under appraised with Shell's efforts since concentrated on the huge offshore fields.
Based on existing wells and seismic the Belait oil and gas field is estimated to contain contingent resources of between 10-50+ million barrels of oil and hundreds of billions of cubic feet of gas in the shallow reservoirs alone. This resource has been independently assessed. Little exploration and appraisal work has been carried out in recent times and importantly, the deeper targets identified on seismic at around only 2,000 meters have yet to be investigated.
Additionally, there are numerous play types and prospective trends outside of the Belait field in this hydrocarbon prolific area that have not yet been explored in any systematic way.
Tap has agreed to an exploration and appraisal program whereby it will drill at least 3 wells and acquire additional 2D and 3D seismic in the initial exploration phase with the objective of achieving early appraisal and production of Belait, and exploring the deeper potential targets. Tap will earn its interest in this block by investing around $20 million over the next five years however, at this stage, Tap expects to accelerate this program given the high impact potential for booking reserves and early production of both oil and gas.
The Block is located close to existing oil and gas processing and export facilities with the Belait field located only 30km from the Brunei LNG plant.
As stated in recent investor presentations, Tap has implemented substantial changes to its strategy and technical approach over the past two years targeting quality petroleum permit interests in proven hydrocarbon provinces in Australia and SE Asia. The Brunei award represents a significant step in this strategy that follows the Philippine initiative and several other opportunities that are currently being investigated. These initiatives will deliver Tap shareholders significant upside that is near term and relatively low risk.
Tap has been seeking higher equities and Operatorship in areas where near term reserves and production are achievable. The Block M award meets Tap's criteria and has excellent potential for near term substantial production of oil and gas from the existing but under explored and appraised Belait field. Considerable exploration potential elsewhere in this large under explored and appraised block is demonstrable.
Tap is further extremely pleased to have won the confidence of PetroleumBRUNEI to operate this high potential block and looks forward to a long and successful working relationship with Brunei.
Tap looks forward to commencing work on Block M immediately and will establish an in country office in the next few weeks.
Block M participants are Tap Oil as operator with 40%; Valiant International Petroleum with 25%; ChinaOil(Macau) with 20% and Jana Petroleum with 15%.