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
Craig Francis |
Cantor Fitzgerald
Europe
(Nominated Adviser and Joint Broker) |
Tel: +44 20 7894 7000 |
Frank Buhagiar
Susie Geliher |
St Brides Partners Limited |
Tel: +44 20 7236 1177 |