COE 1.59% 31.0¢ cooper energy limited

cooper energy buys indonesian onshore block (artic

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    Cooper Energy Buys Indonesian Onshore Block

    Cooper Energy Limited yesterday announced its most significant international acquisition to date, after acquiring 50% of South Madura Exploration Pty Ltd that holds 90% of the rights and obligations in the South Madura Production Sharing Contract (PSC).

    The PSC is a high-potential onshore block covering the south of Madura Island, Indonesia, which is surrounded by a number of major oil and gas fields in the East Java Basin. Cooper are expecting to drill the first onshore well in the PSC in this block in early 2006.

    The South Madura PSC is located in East Java, approximately 120 km northwest of Bali, immediately to the north of the Jeruk and Oyong oil and gas discoveries. The PSC also lies close to ExxonMobil's recently announced Banyu Urip discovery in East Java.

    Cooper Energy's CEO, Michael Scott, said the company had identified several leads and prospects at the Ngrayong and Kujung geological levels.

    "At the Kujung carbonate level there appears to be a reef structure, which may be analogous to the Jeruk Field,” Mr Scott said

    "The reef prospect has been previously overlooked because it lies in the transition between the onshore and offshore exploration areas. At the shallower Ngrayong sandstone level, an existing well on the block encountered a 4 metre gas sand, but this was not tested as gas was not considered economic at the time. This discovery may represent an economic gas field pending further evaluation.

    "Both the Kujung carbonate and the overlying Ngrayong sandstone prospects can be tested by a single well which will be the priority focus of our proposed exploration drilling program. Should the exploration well be successful there are a large number of follow-up targets in the PSC at all hydrocarbon play levels." Mr Scott said.

    "Significantly, the onshore location of the South Madura PSC means that the cost of exploration drilling and development is considerably lower than that for offshore fields. The PSC's proximity to Surabaya, the second largest city in Indonesia, enhances the range of marketing options."

    "The South Madura PSC is located in the heart of one of the most prolific oil and gas regions with several major discoveries announced in the last few years in the East Java Basin." he added.

    The farm-in to the PSC will cost Cooper Energy US$1.5 million,made up of past costs, vendor consideration and PSC contractual payments. Cooper Energy will fund its share of acquisition and exploration expenditures from cash reserves.

    Mr Scott said the first well is expected to be drilled in the South Madura PSC early in 2006 following seismic processing and interpretation. The seismic work will also define the follow-up targets within the PSC at all play levels.

    - 06 Sep 2005

    wrxsti

 
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