Coro Energy (LSE:CORO) said that its 2019 drilling programme in the Duyung Production Sharing Contract (PSC) offshore Indonesia has been approved in an announcement on Monday. Coro, along with its partners Empyrean Energy (LSE:EME) and Conrad Petroleum have agreed to a drilling campaign comprising of two wells on the Mako gas field. Firstly, an exploration well will be drilled to test the Tambak prospect beneath the central area of the
Mako field followed by a well to appraise the intra-Muda sandstone reservoir in the southern area of the field.
Coro holds a 15% interest in the Duyung PSC and the Mako gas field is located near the West Natuna Transportation System opening-up the potential opportunity to sell gas straight into the Singapore market.
The Tambak prospect has a mid-case prospective resource potential of around 250 billion cubic feet (Bcf) and its chance of success (CoS) is estimated to be 45pc. Meanwhile the Mako shallow prospect has a resource potential in the region of 100 Bcf with a much higher estimated CoS of 75pc.
Coro says it is fully funded to contribute the required $10.5m towards the total cost of the drilling campaign including the testing phase. Drilling is expected to commence in the fourth quarter of 2019 and each well will take approximately 33 days to drill and test.
James Menzies, Chief Executive Officer of Coro Energy commented:
“We are pleased to announce the approval of the 2019 drilling campaign, for which we are fully funded. This drilling programme will provide our investors with near-term exposure to the exploration drill bit as well as low risk appraisal, which we are confident will add further value to our position in this exciting project.”
Partner Empyrean, also listed in London, has a 10pc interest in West Natuna Exploration Limited which in turn holds 100% of the Duyung. Back in June 2017, Empyrean was involved in the Mako South-1 appraisal well. The well exceeded the Company’s expectations encountering excellent reservoir quality rock with high permeability sands in the multi Darcy range with 23 feet of gas bearing reservoir. Gas successfully flowed at a stabilized rate of 10.9 million cubic feet per day through a 2 inch choke, and is of high-quality with no other contaminants.
Empyrean CEO, Tom Kelly commented: “This is an exciting period for the Company. In addition to the upcoming drilling campaign at Duyung, progress is being made across our asset base.
“Empyrean looks forward to this exciting drilling programme that is designed to both appraise the existing Mako Gas Discovery as well as testing the deeper Tambak exploration prospect. This programme is a crucial step in the Plan of Development for Mako and paves the way for completion of gas sales negotiations as well as potentially increasing resources at Mako and possibly below the Mako discovery.