Natural gas exploration and development firm Conrad Asia Energy Ltd, has signed a memorandum of understanding (MoU) with PT Perusahaan Gas Negara Tbk (PGN), the gas subsidiary of Indonesia’s PT Pertamina (Persero) to supply and develop gas infrastructure.
Under the terms of the MoU, Conrad will partner with PGN in the provision of gas or liquefied natural gas (LNG) supply and development infrastructure for gas resources from its two Aceh production sharing contracts (PSCs) offshore Indonesia, Offshore North West Aceh (ONWA) and Offshore South West Aceh (OSWA).
The parties will undertake a joint study to examine commercialization options for the gas resources in the two PSCs, with the existing shallow-water discoveries being the initial area of focus. They aim to cooperate in the development and maintenance of potential small-scale LNG infrastructure as well as the sales of LNG. The MoU also covers broader cooperation between the two parties relating to the blocks, Conrad said in a news release.
Conrad holds 100 percent operating interests in both ONWA and OSWA. The two Aceh PSCs were awarded to Conrad in January 2023. The blocks cover approximately 7,722 square miles (20,000 square kilometers), with each PSC having a 30-year tenure.
According to competent person reports cited by Conrad, the two PSCs have estimated gross 2C contingent resources of 214 billion cubic feet (Bcf) of sales gas, of which 161 Bcf is net attributable to Conrad, in three of the four shallow-water discovered gas accumulations. The reports also ascribe a net present value of $88 million attributable to Conrad, according to the release.
To date, the total prospective resources identified within the two PSCs amount to 15 trillion cubic feet (Tcf) of recoverable gas, of which around 11 Tcf are net attributable to Conrad. Several multi-Tcf targets have been identified in the deep-water areas, which are “attracting interest from larger upstream companies”, Conrad noted.
This year, Conrad plans to acquire 3D seismic over the cluster of discovered resources in ONWA in order to better define the resource size. The 3D data may also assist in identifying new prospects in the vicinity of the cluster, where vintage 2D seismic supported 70 percent exploration success rates in the Miocene shallow-water carbonates, the company said.
“Conrad has been evaluating the offshore Aceh areas for more than five years and is excited about their potential”, Conrad Managing Director and CEO Miltos Xynogalas said. “There have been a host of major gas discoveries recently announced offshore Aceh which has brought the region back into international focus for gas exploration companies”.
“Our PSCs lie within a proven biogenic gas region containing flow tested gas discoveries, as well as high impact deep-water exploratory potential”, Xynogalas continued. “The shallow-water discoveries are of near-term interest for PGN and appear suitable for commercialization via small-scale LNG plants—an already proven solution for gas deposits of this size elsewhere in Indonesia”.
“This outcome and our collaboration with the major national gas buyer highlights the importance of the Aceh resources in Conrad’s broader portfolio and underscores our commitment to support Indonesia’s energy needs. This MOU with PGN is an important milestone towards the maturation of the discovered resources in the Aceh PSCs”, he concluded.
Conrad focuses on the shallow waters offshore Indonesia. The company’s flagship project is the Mako Gas Field located in the Natuna Sea in the shallow offshore waters of Indonesia. Mako lies along a large natural gas pipeline to Singapore, which supplies high-value natural gas into Singapore primarily for electricity generation. The Mako gas field is one of the largest gas discoveries in the region, according to the release.
To contact the author, email rocky.teodoro@rigzone.com
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