In April 2017, Empyrean acquired a 10% shareholding in West Natuna Exploration Ltd (WNEL) from Conrad Petroleum), which held a 100% Participating Interest in the Duyung Production Sharing Contract (Duyung PSC) in offshore Indonesia. Conrad is the operator of the Duyung PSC.
Subject to final government approvals, this shareholding will be reduced to 8.5% following the agreement for Coro Energy plc (Coro) to acquire a 15% interest in the Duyung PSC from WNEL, completed on a pro rata basis from the existing owners, as announced in February 2019.
The Duyung PSC covers an offshore permit of approximately 1,100km2 in the prolific West Natuna Basin. The main asset in the permit is the Mako shallow gas discovery that has an independently verified 2C and 3C gas resource of between 430-650 Bcf recoverable gas, that was completed before drilling the Mako South-1 well.
Mako Gas Field – Contingent Resources Certified by Gaffney, Cline & Associates
The Mako South-1 well encountered excellent reservoir quality rock with high permeability sands in the multi Darcy range with 23 feet of gas bearing reservoir. This zone flowed gas at a stabilised rate of 10.9 million cubic feet per day through a 2 inch choke. The gas was of high-quality being close to 100% methane.
Plan of Development Approval for Mako Gas Field
In March 2019 Empyrean announced that the Ministry of Energy and Minerals in Indonesia had approved the Plan of Development (‘POD’) for the Mako Gas Field, securing tenure until 2037. The POD approval was required ahead of the drilling programme at the Duyung PSC, as detailed below. The approval is also an important step in advancing negotiations and ultimately executing a Gas Sales Agreement (‘GSA’) with the buyer in Singapore for the off-take of Mako gas.
Duyung PSC Appraisal and Exploration Drilling Programme – October/November 2019
During October and November 2019, the operator conducted a successful appraisal and exploration drilling campaign in the Duyung PSC, comprising two wells. Both wells appraised the intra-Muda sands of the Mako gas field with one of those wells also designed to test the deeper exploration Tambak prospect targeting the Lower Gabus reservoir interval. The Lower Gabus reservoir did not provide a commercial discovery.
The appraisal of the intra-Muda sandstones of the Mako gas field has been better than expected with better quality sands and a thicker reservoir encountered and the flow test now from two wells has confirmed the deliverability of Mako gas. The excellent appraisal results at Mako are expected to deliver a significant uplift in overall tank size.