Great news long termAttention Business Editors:
Serica Energy plc Announces Award of new Indonesian Production Sharing Contract and UK drilling update
LONDON, England, Dec. 14 /CNW/ - Serica Energy plc (AIM and TSX Venture:
SQZ) is pleased to announce that it has been awarded the Kutai Production
Sharing Contract ("the PSC"), and provides a UK drilling update.
Award of new Indonesian PSC
The Kutai PSC covers an area, both onshore and offshore, of approximately
4729 sq km within the prolific Kutai Basin of East Kalimantan, Indonesia.
Serica is the operator of the PSC and will hold a 52.5% interest in the Block.
Serica's partner, PT Ephindo, will hold the remaining 47.5% interest. The PSC
contains several previously drilled wells that successfully established the
presence of hydrocarbons. Serica will be acquiring a limited amount of new 2D
and 3D seismic to augment the pre-existing seismic data set, as part of its
work programme to assess the prospectivity of the block, which will also
include the drilling of up to four exploration wells.
Chris Atkinson (Chief Operating Officer) commented:
'We are delighted to have been awarded this extremely promising
Indonesian PSC, which fits in with our strategy to expand our South East Asia
portfolio into new areas in which we have specific technical knowledge. Our
technical team and our partner, PT Ephindo, have a detailed understanding of
the Kutai Basin which comprises Indonesia's second most prolific petroleum
province. Serica is very much looking forward to exploring this area under
better fiscal terms than were previously available and with the benefit of
modern 3D seismic data and the latest interpretation techniques."
UK Drilling Update
Unusually extreme weather conditions are currently being experienced in
the UK North Sea and therefore it has not yet been possible to commence
testing the Columbus well in Block 23/16f. However, Serica expects to be able
to commence flowing the well within the next week and results of the tests
should be available by the end of the month.
Paul Ellis (Chief Executive Officer) commented: "We remain very positive
about the potential of the prospect being targeted by the Columbus well in the
UK North Sea and by its implications for the prospectivity of the new acreage
that we are acquiring in Block 23/21 through our recent agreement with BG
Group. We look forward to being in a position to announce the results of the
tests in the near future."
Information on the Kutai PSC
The Kutai PSC comprises several contiguous blocks, most of which were the
result of first phase relinquishments by the current main operators in the
basin, Total, Chevron and VICO. The PSC lies in and around several giant
fields including Tunu ((greater than)1.600mmboe) and Attaka ((greater
than)800mmboe).
The blocks forming the PSC straddle the prolific Mahakam River delta both
onshore and offshore in water depths that range from zero in the west to less
than 200 metres at the eastern margin. The adjacent major fields on the shelf
were mainly discovered in the late 1960's and 1970's by Total, Unocal and
VICO. To date the area has produced over two billion barrels of oil and
20 trillion cubic feet of gas and is currently providing over four billion
cubic feet of gas per day to the Bontang LNG facility under long term
contracts to supply gas into the rapidly expanding markets of northern Asia.
Background Notes
In Indonesia, Serica also operates the Biliton PSC, the Asahan Offshore
PSC and the Glagah Kambuna TAC and the drilling of six exploration,
development and appraisal wells across the assets is scheduled in 2007.
Forward Looking Statements
This disclosure contains certain forward looking statements that involve
substantial known and unknown risks and uncertainties, some of which are
beyond Serica Energy plc's control, including: the impact of general economic
conditions where Serica Energy plc operates, industry conditions, changes in
laws and regulations including the adoption of new environmental laws and
regulations and changes in how they are interpreted and enforced, increased
competition, the lack of availability of qualified personnel or management,
fluctuations in foreign exchange or interest rates, stock market volatility
and market valuations of companies with respect to announced transactions and
the final valuations thereof, and obtaining required approvals of regulatory
authorities. Serica Energy plc's actual results, performance or achievement
could differ materially from those expressed in, or implied by, these forward
looking statements and, accordingly, no assurances can be given that any of
the events anticipated by the forward looking statements will transpire or
occur, or if any of them do so, what benefits, including the amount of
proceeds, that Serica Energy plc will derive there from.