Coro Energy, an AIM-listed gas explorer, has completed its payment obligations to acquire a 15% working interest in the Duyung PSC offshore Indonesia.
Coro Energy agreed to buy the 15 percent stake in the Duyung PSC back in February. The agreement was for Coro to pay $4.8 million and also contribute $10.5 million for the 2019 drilling campaign.
Before this acquisition, West Natuna Exploration Limited (WNEL) owned a 100% stake in the Duyung PSC. WNEL is owned by Conrad Petroleum (90% and operator) and Empyrean Energy (10%).
Coro said on Tuesday that it had paid existing owners of the Duyung PSC a total consideration of $2.95 million in cash and $1.85 million in Coro shares as well as providing a $10.5 million contribution towards the 2019 exploration and appraisal drilling campaign to earn its 15% interest in the Duyung PSC.
Transfer of 15% interest to Coro is subject to Indonesian regulatory approval, which is expected to follow, with a long-stop date of December 31, 2019.
Should regulatory approvals not be forthcoming, Coro agreed to receive a transfer of 15% of the shares of WNEL, the current owner of the Duyung PSC.
As per the share purchase agreement, Conrad and Empyrean agreed not to sell or transfer consideration shares until the earlier of 15 days after the completion of the 2019 drilling program or Coro announcing the completion of drilling works, whichever comes first.
The company also made an application for the shares to be admitted to trading on AIM, which is expected to occur on April 24.
Mako gas field
The Duyung PSC contains the Mako gas field, a large, shallow structural closure, with an area extent of over 350 square kilometers.
The Mako field is located in the prolific West Natuna basin, some 16 kilometers from the WNTS pipeline system which delivers gas from Indonesia to Singapore.
A plan of development has recently been approved by the Indonesian authorities, and initial gas marketing discussions have commenced with a gas buyer in Singapore. The field has 2C recoverable resources of 276 Bcf and 392 Bcf of 3C recoverable resources.
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