Cue Energy Resources Limited has received approval for further development of the PB oil production field in the Mahato Production Sharing Contract (PSC) in Indonesia from SKKMigas, the country’s regulator.The approved Field Development Optimization (OPL) Phase 2 includes the drilling of 14 new development wells, converting an existing production well to a water injection well, and constructing three new drilling locations, Cue Energy said in a news release, noting that additional production facilities and in-field pipelines will also be constructed.
Cue Energy said it has started the first well in the program, with the full development expected to take 12 to 18 months.A total of 22 oil production wells have been drilled in the PB field to date, with current production exceeding 6,000 barrels of oil per day (bopd), according to the release. The oil is exported from the field via shared pipeline infrastructure, and there are no capacity constraints expected with additional field production, the company said.
Mahato well economics are “very attractive,” Cue Energy said, outlining that drilling and development costs are recoverable by the Mahato Joint Venture from field production revenue, under the PSC with the Indonesian government.
“It is very pleasing to report that SKKMigas has approved this further development of the PB oil field. The field currently produces over 6,000 bopd gross at a low cost. This next phase of development has the potential to boost and extend field production further. Activity has already commenced, with all 14 wells expected to be completed within two years,” Cue Energy CEO Matthew Boyall said.
Cue Energy holds a 12.5 percent interest in the Mahato PSC located in Central Sumatra, Indonesia. Oil production from the PB field within the PSC has been ongoing since early 2021, following the drilling of discovery wells in late 2019. The Central Sumatra Basin hosts some of Indonesia’s largest oil fields, including the Minas and Duri fields, according to the company’s website.
Following successful exploration in late 2019, the PB field within the Mahato PSC saw the initiation of commercial oil production in early 2021, beginning with the first well, PB-1. The Indonesian government granted approval for a Plan of Development (POD), encompassing a total of eight wells.
The other Mahato PSC joint venture partners are operator Texcal Energy Mahato with a 25 percent stake, Texcal Mahato with 51 percent, and Central Sumatra Energy with 11.5%.
Further, Cue Energy holds a 15 percent interest in the Sampang PSC located in the Madura Strait, East Java, Indonesia. The PSC comprises two producing fields, the Oyong and Wortel gas fields, along with a gas discovery at Paus Biru. Gas extracted from the Oyong and Wortel gas fields is transported via a subsea pipeline to the Grati gas processing plant, where it is then supplied to PT Indonesia Power as a fuel source for the Grati electricity generation plant.
Melbourne-based Cue Energy Resources Limited is an oil and gas production company listed on the Australian Securities Exchange. The company’s first-half revenue was $19.41 million (AUD 29.3 million) from gas and oil production from the Mahato and Sampang PSCs, Indonesia and the Mereenie, Palm Valley and Dingo fields, onshore Australia, and the Maari field, offshore New Zealand.
Source:https://www.rigzone.com