Quest Petroleum finalising Ranau PSC work program for 2013-14 Thursday, August 01, 2013 by Bevis Yeo
Quest Petroleum finalising Ranau PSC work program for 2013-14 Quest Petroleum (ASX: QPN) is finalising its Ranau production sharing contract work program for 2013-2014 with Indonesian oil and gas regulator SKK Migas.
As part of the work program submission, the company has conducted an extensive review of the existing gravity data for the Ranau block, and has also engaged existing operators in the region who have provided valuable information for the planned work program.
It has also located where existing seismic data is available on the Ranau block and is currently negotiating the purchase of this data that will add to this program.
The company had in the June quarter executed a formal outright land purchase agreement with the owner of the land at Way Kanan in the southeast portion of the Ranau PSC in South Sumatra.
Besides opening up the site of its first well – Prabu-1, the acquisition also enables it to use the land for multiple purposes including exploration and future production wells and infrastructure.
The proposed Prabu -1 drill site (formerly Kayumanis-1), is situated on well drained, elevated land adjacent to a paved asphalt road which allows good access to for drilling and completion operations.
The drill site is situated on the edge of an identified structural high proximate to three significant sub-basins with clear potential for hydrocarbon generation.
Prabu-1 targets the Baturaja Limestone and Talang Akar Sandstone Formations, which are the most prolific oil and gas reservoirs in the South Sumatra Basin.
Gas discovered on the Ranau PSC can be commercialised through the nearby South Sumatra – West Java (SSWJ) gas transmission pipelines and processing infrastructure that supply large markets in Sumatra, West Java and Singapore.
Domestic gas markets are growing rapidly as distribution networks are built and gas prices achieved in Indonesia are currently US$4.50 to US$7 per thousand cubic feet.
Discovered oil may be commercialised through facilities located within 50 kilometres of the Ranau PSC. These facilities process and transport oil from the large, Pertamina-operated, fields to the north of the Ranau PSC.
Quest is trading at just over 50% cash backing with $4.4 million in cash and cash equivalents - including security deposits for the Ranau Performance Bond as of 30 June 2013. This compares with its current market capitalisation of $8.7 million.
QPN Price at posting:
0.3¢ Sentiment: Buy Disclosure: Held
