Andalas Energy and Power Plc Update on Tuba Obi East
April 25 2017 - 7:59AM
UK Regulatory
TIDMADL
25 April 2017
Andalas Energy and Power Plc
('Andalas' or the 'Company')
Update on Tuba Obi East
Andalas Energy and Power Plc, the AIM listed Indonesian focused energy Company
(AIM: ADL), provides an update on the Tuba Obi East oil and gas concession
('TOE') in the South Sumatran Basin.
Tuba Obi East ("TOE") is one of a cluster of three gas fields identified by
Andalas as suitable for development as an integrated wellhead independent power
producer project ('IPP'). The other offsetting fields, which are operated by
Pertamina, are known as Karang Makmur and Simpang Tuan. Pertamina has
indicated that following the expiry of the TOE technical assistance contract
("TAC") that it will retain and develop TOE alongside the offset fields as a
single integrated unit (the "MJ Cluster").
This is in line with the Company's cooperation agreement signed with Pertamina,
Indonesia's national oil company, in September 2016, to develop wellhead IPPs
utilising Pertamina's significant inventory of gas assets. As part of this
agreement, in December 2016, Andalas submitted its first 2 x 30 MW Wellhead IPP
project development with Pertamina for government approval. The Company can
now advise that this first project envisages sourcing gas from fields included
within the Pertamina owned MJ Cluster, which is now expanded to include the gas
resources at TOE. The advantages of Pertamina operating TOE are as follows:
* Pertamina will fund the upstream development at the MJ Cluster, which has
the potential to exceed $50million. Andalas believes it can create more
value by concentrating its resources on progressing its Wellhead IPP
project and pipeline;
* Pertamina, as owner of the enlarged MJ Cluster, has the technical and
financial resources to fast track the development of this asset to match
Andalas' ambitions to use the gas to develop the MJ Cluster IPP project;
* The company's timetable and ability to meet its target of 250-500MW of
installed capacity is enhanced by this decision.
Andalas CEO, David Whitby, said: "As our recent project submission and project
inventory updates attest, our cooperation with Pertamina continues to
strengthen, therefore rather than focus our resources on developing a single
smaller gas to power project at TOE, we are focussed on continuing the momentum
we have in developing a portfolio of at least five projects with Pertamina that
each have the ability to add significant value.
"The inclusion of TOE in the MJ Cluster is a logical next step with the
benefit of removing from Andalas the obligation to fund an upstream gas project
that was not fundamental to our wellhead IPP strategy. At the same time with
Pertamina now the operator, TOE is back in the hands of our partner who has the
resources, technical capability and the desire to develop the broader MJ
Cluster unit to supply Andalas' first wellhead IPP project."
**ENDS**
For further information, please contact:
David Whitby Andalas Energy and Power Plc Tel: +62 21 2783 2316
Sarah Wharry Cantor Fitzgerald Europe Tel: +44 20 7894 7000
Craig Francis (Nominated Adviser and Joint
Broker)
Frank Buhagiar St Brides Partners Limited Tel: +44 20 7236 1177
Susie Geliher
END
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