(WO) – Indonesia Energy Corporation, an oil and gas exploration and production company focused on Indonesia, has updated its discovery wells drilled in 2022 and its ongoing development activities and plans for 2023 and beyond, including a potential contract extension for its Kruh Block.
To maximize the production at Kruh Block, IEC is in the process of conducting a workover of the existing Kruh-21 well, which was drilled in 2015. Regarding the Kruh-28 well, IEC unexpectedly found evidence of a potential natural gas bearing reservoir between the 976 and 1,006 feet interval with 30 feet net thickness.
This initial evidence was supported by both wireline logging and geologic logging data, and subsequent gas flaring. Oil production from the Kruh-21 and Kruh-28 wells is expected in the third quarter of 2023. If a commercial amount of gas is tested in the Kruh-28 well, a development plan will be submitted to the Government of Indonesia for approval and with the goal commencing gas production in 2024.
Fracture stimulation of the already oil producing Kruh-27 well has been completed, with 80,000 pounds of proppants having been injected into the sand producing reservoir with the goal of increasing production productivity. A previous fracturing program conducted in IEC’s Kruh-26 well brought the original production of 18 bopd to a post-fracturing rate of 75 bopd.
To maximize the potential of Kruh Block after several encouraging new oil discoveries made by IEC during 2021 and 2022, IEC is currently in the process of securing 30 square km of new three-dimensional seismic data at Kruh Block. The environmental permit has been issued and the material needed to conduct this seismic work has been secured. Concurrently, the seismic acquisition contractor has been selected and IEC is finalizing the detailed plan and model for the exploratory activity.
IEC believes that this new work at Kruh Block, together with what has been learned from 2022 oil and gas discoveries, will greatly assist IEC in ascertaining the best locations conduct its continuous drilling campaign at Kruh Block that will look to develop not only the one formation currently being targeted, but also look to develop what appears to be at least three additional oil formations that could contain significant commercial quantities of oil and natural gas.
After completion and full interpretation of this seismic operations, IEC plans to re-start its continuous drilling campaign at Kruh Block. IEC currently expects this seismic exploratory and interpretive work to be concluded before the end of 2023, and IEC still plans on drilling a total of 18 new wells at Kruh Block, four of which have already been completed, by the end of 2026. Previously IEC had announced its intention to complete these 18 new wells by the end of 2025.
IEC is also in the process of negotiating a five-year extension of the contract covering the Kruh Block with the Government of Indonesia, which would extend the term of IEC’s operatorship until 2035. This extension would effectively give IEC over 12 more years to fully develop the existing 3 oil fields, and 5 other undeveloped oil and gas bearing structures at Kruh Block.
IEC has submitted its work program proposal and it has been accepted by the Government by its responsible entities via Pertamina (the Indonesian state-owned oil and gas company) and SKK Migas, the Indonesian special task force for upstream oil and gas business activities. IEC is currently waiting for the draft contract to be approved.
At the same time, on IEC’s million-acre Citarum Block, the environmental permit for two-dimensional seismic data acquisition is in the final approval process. IEC expects to receive the permit in the third quarter of 2023, which would allow IEC begin the data acquisition work in the fourth quarter of 2023.
