- Progressed development of the Southeast Mengoepeh gas field, highlighted by Memorandum of Understanding signed with PT BlueEnergy for gas offtake.
- Exited the fourth quarter with December production of 960 bbl/d1; January 2025 production to date has averaged
1,020 bbl/d1.
- Total of 15 workovers completed in 2024 increasing Mengoepeh field production by 65%1 over Q4 2023.
- Continued cost reductions led to December operating costs equivalent to US$32/bbl2, a 30% decrease from January
2024.
Criterium Energy Ltd. (“Criterium”) (TSXV: CEQ), an independent upstream energy development and production company focused on energizing growth for
Southeast Asia today announced preliminary Q4 operating results and provided an update on recent production
and development activities in the Company’s Indonesian portfolio.
“2024 was a transformative year for Criterium, acquiring and integrating the Mont D’Or assets and team into our
operational base,” said Matthew Klukas, President and CEO of Criterium Energy. “With a disciplined focus on our
workover program we have demonstrated our ability to steadily increase production. Combined with our strict
focus on reducing operating costs we are driving meaningful improvement in cash flow from operations. Our
focus for the year ahead will be on improving netbacks further while advancing the development of our expanding
gas resources, which we expect to have a material impact on our operations sooner than we anticipated. On that
front, we have taken a number of steps to advance the Southeast Mengoepeh gas development at a rapid pace,
helping to shorten development timelines and provide optionality on egress, all with the goal of monetizing
production as quickly as possible.”
Selected Q4 2024 Operating and Financial Highlights
- SE-MGH Progress: Achieved significant milestones for the Southeast Mengoepeh gas field ("SE MGH"), including obtaining approval for its development plan under the existing Mengoepeh Plan of Development. Additionally, the company signed a Memorandum of Understanding (“MOU”) with PT
BlueEnergy for the sale and purchase of natural gas from the field and is exploring the use of Galileo Technologies’ MicroLNG technology as a cost-effective solution to liquefy and transport gas, offering an alternative to traditional pipeline infrastructure.
- Increased Production: Achieved average field production in the Tungkal PSC of 957 barrels per day1("bbl/d") in Q4 2024, up from 880 bbl/d in Q3 2024. The increase reflects additional workovers conducted in December and ongoing maintenance which has reduced well downtime. Average daily field
production in December 2024 was 960 bbl/d1, and 1,020 bbl/d1 thus far in January 2025. Total Company production has grown more than 20% since January 2024.
- Continued workover success: Completed four workovers during the fourth quarter, bringing total workovers for 2024 to 15. These workovers delivered incremental volumes on stream at less than US$2,000 per flowing barrel3 and to date has seen over 4x payback3 in aggregate.
- Further reduced operating costs: Q4 2024 operating costs, including G&A and corporate costs, were estimated at US$2.97 million2 or US$34/bbl, which is a 26% reduction from January 2024 when Criterium acquired the assets. Lower costs were due to implementation of cost control measures and the use of produced natural gas for power generation, reducing diesel purchase and consumption.
- Strong netbacks: Operating netbacks were stable at US$24/bbl2 in the fourth quarter versus the third quarter of 2024, despite a US$6/bbl drop in oil prices
Further Progress at Tungkal PSC and the SE MGH Development
Development Plan Approval: In 2024, Criterium completed a technical feasibility study for the development plan
of the SE-MGH gas field in the Tungkal PSC and submitted it to the government for inclusion in the existing Mengoepeh Plan of Development, avoiding the need for a standalone plan. The submission was approved in the fourth quarter, reducing the government approvals required to bring gas on stream. Gas development is expected to be a key component of the Company's strategic plan with the potential to add over 1,000 boe/d of production from SE-MGH alone.
MOU with PT Energasindo Heksa Karya (EHK): To support this strategy, Criterium successfully executed an MOU during Q2 2024 with PT Energasindo Heksa Karya ("EHK"), a company owned by Rukun Raharja and Tokyo Gas. Under the agreement, EHK will purchase discovered gas from SE-MGH and the Tungkal PSC.
MOU with PT BlueEnergy and MicroLNG Technology: During the fourth quarter, Criterium signed an MOU with
PT BlueEnergy to support the egress of produced natural gas using Galileo Technologies’ MicroLNG technology.
The Cryobox™ LNG Production Station provides a modular and transportable solution for liquefying natural gas directly at the source. This technology enables efficient on-site gas processing, addressing the challenges of stranded gas by eliminating the need for extensive pipeline infrastructure.
Workover Program
Criterium commenced a program of low-cost, high-return workovers in the oil producing Mengoepeh field
(“MGH”) in March 2024 and completed a total of 15 workovers during the year targeting existing and new
producing intervals. In aggregate the workovers have generated more than US$3 MM incremental cash flow3
to date from an investment of approximately US$600k. Workovers, especially those targeting the newly discovered
GH sand zone, continue to perform above expectations, enabling Criterium to rapidly recycle capital given cash
paybacks average less than 30 days per workover. The positive impact of this program is reflected in Criterium's
continued growth in production, revenue and financial flexibility. Additional information on the results of each
workover is available in the corporate presentation, which can be found on the Company's website.
Drilling/MGH-43 Update
In September 2024, the Company drilled the MGH-43 well which is its first infill well campaign on the Tungkal
PSC, focused on untapped areas in the MGH field, targeting multiple pay zones within the Talang Akar Formation
(the "TAF"). The fluvial deltaic reservoir within the TAF features on average 20 to 25 metres of net pay, with 10
to 20% porosity and 50 to 100 millidarcies of permeability, reservoir characteristics that are typically associated
with higher productivity.
The well intersected multiple reservoir zones in the TAF with good to excellent oil shows. Logging completed on
MGH-43 identified prospective producing intervals in the CT, CH, EL, EH, F, and GH intervals. These total an estimated 41m of prospective gross sand interval3,4
that were perforated in late November 2024. The Company
also identified approximately 13m of Net Pay4 potential gas bearing sands in the Gumai formation (~500-580m
MD). The Gumai zone is present throughout the MGH field and has indications of hydrocarbons but has not been
tested. The Company is currently evaluating how this discovery could complement the SE MGH gas development.
Based on the work conducted and production observed to date, management believes that there is potential
formation damage in selected zones. The Company now intends to take the following steps to help enhance
production from the oil bearing zones, confirmed during completion activities, including: (1) acidization to help
mitigate potential formation damage; (2) bringing in a saturation measurement tool to understand oil content;
and, (3) conducting zonal isolation down hole. Depending on the results of this optimization work management
also has the option to test the upper Gumai gas zone, which would tie in with the Company’s broader gas strategy
for 2025.
Bulu Transaction Update
On September 5th 2024, Criterium received a second US$500,000 non-refundable payment from the buyer of its
wholly owned subsidiary which owns a 42.5% non-operated working interest in the Bulu Production Sharing
Contract, as originally announced on May 21, 2024. Inclusive of this US$500,000 payment, to date Criterium has
received US$1,000,000 of the US$7,750,000 total purchase price consideration for the transaction. Management
continues to work with the original buyer to close the transaction, however, the company is also currently
evaluating alternatives to unlock value for shareholders including discussions with alternative buyers. The
Company intends to provide an update later in the first quarter of 2025.
Outlook
Management currently expects to release its strategic plan and budget for 2025 during the first quarter. Key
activities envisioned under the plan are expected to include prioritization of the SE-MGH gas development,
leveraging existing infrastructure and unused capacity to minimize costs; and the execution of additional
workovers in the MGH field to extend the success of the 2024 workover program.