Lion has a 40.7% interest in The South Block A PSC. Lion, in conjunction with Operator REE, recently announced the increase in this interest from 35% after exercising their right to default PT Prosys Oil & Gas International (POGI) that held a 14% interest in the PSC. through its wholly owned subsidiary KRX Energy (SBA) Pte Ltd. Please click here to view the full announcement.
The underexplored block is centrally located in the prolific North Sumatra Basin and contains large structures with attractive gas and oil plays. The region has a strong demand, high priced gas market and a new open access pipeline connected to Medan extends through the PSC acreage.
The South Block A PSC which, following a January 2017 relinquishment has an area of 421km2, is divided into two separate blocks, the western block is known as Area 1 and covers an area of 366km2, while the smaller Area 2 block to the east, extends over the coastal boundary with an offshore portion, and covers an area of 55km2.
Amanah Timur-1 was drilled by the Joint Venture in January 2017 and was a discovery with gas and condensate flared and interpreted oil zones. Appraisal drilling is planned in 2017. The Amanah Timur location is also within 6km of the city of Langsa with a population of approximately 150,000. The region has a gas market with solid demand, consequent high prices and a new open access pipeline to Medan extends through the PSC acreage and within 100 metres of the Amanah Timur location.
Up until 2014, no new seismic had been acquired since the early 1990’s and, before the recent Amanah Timur-1 well, no drilling had occurred in the block since 1992. The block contains attractive plays and continuations of structural trends that have been productive in adjacent blocks.
The North Sumatra Basin is one of the most prolific hydrocarbon provinces in Indonesia with over 80 known oil and gas fields. The United States Geological Survey World Petroleum Report (2000) indicates that reserves of approximately 25.6 TCF of gas, 900 MMBBL of natural gas liquid and 700 MMBBL of oil have been found in the North Sumatra Basin. Recent exploration drilling results in adjacent PSC’s are encouraging. In 2012/13 operator Medco, in the Block A PSC, drilled the Matang-1 gas discovery. Participant in the well, Premier Oil, reported in a press release on 3 May 2013 that the well flowed 25 MMSCFD with 15% CO2 and recoverable gas resource reported in the 100-400 BCF range