KrisEnergy Ltd., an independent upstream oil and gas company, announces it has reduced its working interest in the Block A Aceh production sharing contract to 15% in alignment with its revised business plan to reduce future capital expenditure while maintaining exposure to a high-value gas development in Indonesia.
Proceeds from the transaction will be applied towards funding KrisEnergy’s share of the capital expenditure for the Block A Aceh gas development.
The operator of Block A Aceh, PT Medco E&P Malaka, has acquired 26.6666% of KrisEnergy’s working interest and increased its holding to 85%. The transaction is pending approvals from the Government of Indonesia and the Government of Aceh.
Jeffrey S. MacDonald, KrisEnergy’s Interim Chief Executive Officer, commented: “This farm-out is in line with our recently announced revised business plan to reduce exposure to contract areas where we have a high working interest in order to mitigate risk and reduce future capital expenditure commitments given the continued volatility in oil and gas markets. However, we remain a partner in Block A Aceh and will benefit from long-term revenues and cash flow once the gas fields are developed and on stream.”
Block A Aceh covers 1680 km2 and is located onshore Sumatra in the semi-autonomous region of Aceh. It contains several gas condensate discoveries including the Alur Rambong, Alur Siwah and Julu Rayeu fields, which were approved for development in 2007. A gas sales agreement was signed in January 2015 for a daily contracted quantity of 58 billion British thermal units.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/11112016/krisenergy-reduces-block-a-aceh-working-interest-to-15/