IGas Energy PLC has sold its 24% interest in Sangatta West CBM Inc. to partner Ephindo International CBM Holding Inc. under a share transfer agreement. IGas said the company’s disposal of its remaining Indonesian interests is effective May 13.
The Sangatta West block, according Jakarta-based Ephindo, was the first coalbed methane (CBM) production-sharing contract in Indonesia to have publicly certified reserves with 38 bcf (proved, probable, and possible) and an estimated 273 bcf of contingent resources. The company’s web site cites an additional 193 bcf of recoverable CBM in the larger western sub-block.
The Sangatta West block saw first production in 2011 when Dart Energy Ltd. drilled the SCBM No. 1 in February of that year to 830 m, which flowed gas at an unspecified amount (OGJ Online, Apr. 4, 2011). The block is in the Kutai basin, and primary reservoir targets include Balikpapan and Kampung Baru formations, each of which have a typical seam thickness of 2-7 m.
IGas purchased Dart Energy as farmin to Sangatta West block in eastern Kalimantan in February 2009 for a 24% interest and operated jointly with Ephindo, also with 24% interest (now at 48%). Indonesian national oil company Pertamina holds the remaining 52% interest in the block, which originally covered 1,301 sq km but has since been reduced to 1,168 sq km through a mandatory 10% relinguishment.
In connection with the sale, IGas has applied to the London Stock Exchange for an additional listing of 1,767,220 ordinary shares of 10 pence each to trade on the AIM market.
Ephindo plans to sell gas from its pilot wells in the near term for use in gas-fired power generators with Indonesian power utility PT Perusahaan Listrik Negara (PLN) through its partner Pertamina. This would fuel further development, which currently relies on diesel power. Full-field development could include export options with the Bontang LNG facility about 60 km south of the southeastern portion of Sangatta West block, where much of the drilling has been focused.
Contact Tayvis Dunnahoe at [email protected].
