Cue Energy Resources Ltd., Melbourne, has secured funding to support its existing exploration and development activities in Australia and Indonesia.
The company entered a $7 million, 2-year unsecured loan agreement with New Zealand Oil & Gas Ltd. (NZOG). NZOG holds a 50.04% interest in Cue Energy (OGJ Online, Jan. 18, 2017).
Cue is currently drilling in the Amadeus basin, has started a 14-well program in the Mahato PSC, and expect a final investment decision on the Paus Biru gas development in the Sampang PSC, all of which have significant near-term capital requirements, said Matthew Boyall, Cue chief executive officer.
In the Amadeus basin in the Northern Territory, Australia, partner and operator Central Petroleum is drilling the PV-12 exploration well. Central Petroleum forecast $3.1 million in additional costs for the PV-12 and Dingo-5 wells to Apr. 30, 2022 (OGJ Online, Apr. 22, 2022). Slower-than-expected drilling of PV-12 could result in further cost increases. Cue is obligated to pay CTP’s share of certain exploration and development costs up to a $12 million cap. Cue’s commitment, including the CTP carry, for the remaining expected cost for the drilling program is estimated as $12.2 million. In Mereenie field, the joint venture is considering six well workovers and two infill wells during fiscal-year 2023.
In the Mahato PSC in Central Sumatra, Indonesia, 14 more wells are planned to be drilled in the PB oilfield over the next 12-14 months, with extra processing infrastructure also being constructed (OGJ Online, Mar. 25, 2015). Twelve of these are oil production wells which are expected to deliver revenue, however the timing of costs and revenue is a consideration of the financing with NZOG, Cue said. Cue’s estimated expenditure commitment for this phase of development is about $13 million.
In the Sampang PSC East Java, Indonesia, the Paus Biru final investment decision is expected to be made by the joint venture in the coming months, with development expenditure, if and when approved, expected to be incurred over the following 24 months before first gas production. Cue’s estimated share of Paus Biru development funding is about $15 million.