Ophir Energy to acquire Indonesian exploration licenses

Under the agreement Ophir will pay US$31 million on completion of the transaction, with further success payments payable on the declaration of commerciality of up to four discoveries, and consequently first production from up to four future developments. In aggregate, the total further consideration payable on success is capped at US$56million.

The transaction is subject to approval by SKKMiGas and the Government of Indonesia.

Ophir is acquiring seven PSCs with equity interests ranging from 18.5-100%, six of which will be operated positions, with partners including Statoil and ENI. In total, the acreage covered by the PSCs is approximately 21,500km2.

The licences are split broadly into three core areas:

• The West Papua area is frontier and potentially high-impact, primarily prospective for oil within a carbonate play in which reservoir quality has been partially de-risked by drilling to date.
• The Western Birds Head area, prospective for both oil and gas in clastic and carbonate plays, has been de-risked by existing discoveries on the Kofiau PSC.
• The Makassar Strait area is a proven, world class hydrocarbon province in which several large fields feed the multi-train, but now under-utilised, Bontang LNG plant located onshore East Kalimantan.

Nick Cooper, CEO, Ophir Energy, commented:

“We are excited by the exploration and market opportunities in South East Asia, which can complement our continued expansion in Africa. This transaction with Niko Resources provides one new country entry but access to three new core areas.

This deal represents a significant reloading of the company’s exploration portfolio, expanding our gross acreage by 40% and in combination with Ophir’s recent Myanmar PSC award, positions Ophir as a leading deepwater Asian explorer. We look forward to delivering a number of high impact wells from this new Asian portfolio as well from our existing African assets in the coming years.”