LONDON, Feb. 12 /CNW/ - Serica Energy plc (AIM & TSX-V: SQZ) provides an
update on development activities in the Kambuna field, offshore Northeast
Offshore development works are now underway. The production platform has
been positioned over the Kambuna No. 2 well and piled to the seabed and the
GSF136 jack-up drilling rig is now drilling the Kambuna development wells
No. 3 and No. 4 and will then complete all three wells for production.
Following the previously reported agreement for the sale of gas to the
Indonesian State electricity generation company Perusahan Listrik Negara
("PLN"), at an initial price of US$4.50 per million Btu (approximately
$5.40 per million cubic feet) escalating at 3% per annum, tenders for a
further quantity of gas have now been received at considerably higher prices
and an agreement will shortly be completed.
Being sales to the domestic market, the gas has been contracted under
procedures determined by BPMigas, the Indonesian petroleum industry regulator.
The contract with PLN will account for 28 million cubic feet per day
("mmscfd") and the new tenders are for a further 12 mmscfd. The Kambuna
development wells are expected to produce at a total rate of 50 mmscfd,
leaving 10 mmscfd of gas currently uncontracted. Serica expects that this
future sale of gas will also attract a much higher price than that agreed with
In addition to the gas, Serica will initially be marketing
4,000-5,000 barrels per day of condensate at a price close to that of crude
oil. The Company anticipates that production from the field will commence in
Serica is the operator of the Kambuna Field and holds an interest of 65%
in the project.
Paul Ellis MA (Oxon) Engineering and Serica's Chief Executive, who has
over 35 years' experience in the upstream oil and gas industry, has reviewed
and approved the technical information contained in this announcement.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
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