Cue Energy Gets More Time to Explore for Gas in Indonesia

Indonesian oil and gas regulator SKK Migas has approved Cue Energy Resources's request for a four-year extension to the exploration period of the Mahakam Hilir PSC, located in the prolific Kutei Basin onshore Kalimantan, until May 2020.

The four-year extension includes two contingent wells in the first two years, which Cue can elect to drill or withdraw from the PSC; and geological studies, pre-FEED studies and a development plan in the latter two years.

Cue, which is listed in Australia, has 100 percent equity and is operator of the Mahakam Hilir PSC.

In February, Cue successfully drilled the Naga Selatan-2 (NS-2) exploration well and recovered oil and gas to surface. While drilling the deeper section, gas was also flared to surface. The well was suspended to allow for future production testing.

The results from NS-2 confirmed Cue’s geological model of the area and have provided new information regarding the existence of a potential deeper gas play. Results from the exploration activity are being analysed and Cue expects to be able to announce an internal estimate of volumes in the second half of the year.