Dart Energy Provides Quarterly Update
Dart Energy has provided its quarterly activities report regarding its operation in China, Indonesia and India.
Liulin PSC (Shanxi, China)
Pilot production continued at the Liulin CBM project with peak rate in excess of 1 MMscf/d having been observed. Since May 2012, gas rates from existing wells have increased on a weekly basis and the best well (H-4) reached peak production in excess of 450 Mscf/d with three other wells (H-3, H-6 and H-13) registering peak rates between 200 Mscf/d and 280 Mscf/d.
Preparatory work in respect of construction of the field gas gathering system and nodal station progressed during the quarter following the approval by Liulin PSC Joint Management Committee (comprising of FLG in which Dart Energy has a 50% stake, and CUCBM). The field production rates continue to be controlled for stable operations and to obtain additional reservoir information, which also conserves gas prior to sales during the 2H 2013.
The field gathering system includes 12 km of gathering pipeline, an in-field nodal compression station and an 8 km export pipeline to CUSCM’s (the buyer) CNG facilities. Construction is scheduled for completion in 2013 enabling delivery of sales gas into the existing GSA thereafter.
Sangatta West (East Kalimantan, Indonesia)
Work-overs were carried out on three pilot wells during the quarter and an additional pilot well is scheduled to be drilled in 1Q 2013. Following completion of these wells, production testing will be carried out. Subject to successful testing, these wells are expected to supply gas as part of an early development pilot-to-power project for electricity sold to the local Sangatta township.
Tanjung Enim PSC (Sumatra, Indonesia)
During the quarter, well work-overs were carried out to allow for production testing during 1H 2013 with a planned pilot-to-power project to commercialise pilot gas production in 2H 2013. Dart Energy and EuroAsiatic, an engineering, procurement and construction (EPC) company have formed a joint venture company to perform the role of an Independent Power Producer (IPP) and produce electricity via a 2 MW gas engine. Commercial discussions and legal preparation work in relation to the pilot-to-power project continued during the quarter.
Xiushan Shale Gas PSC (Chongqing Municipality, China)
Dart Energy International and its partners (including ECO Natural Gas Limited and Hong Kong Prosperous Clean Energy Limited) signed a Production Sharing Contract (PSC) with Henan CBM Development and Utilization Company Limited (HCBM) for shale gas exploration, development and production in the Xiushan block in the Sichuan Basin, Chongqing Municipality, China. The PSC is subject to government approval and once approved, this will be the second shale gas PSC ever signed in China. The contract area covers approximately 720 km2.
Bontang Bengalon (East Kalimantan, Indonesia)
During October 2012, Dart Energy signed a PSC in respect of Bontang Bengalon Block awarded to it in September 2012. This follows a formal application for the block that was submitted in July 2012 and a joint study that was previously conducted with the Government of Indonesia. Bontang Bengalon is located in the middle part of the Kutei Basin in East Kalimantan, covering an area of 411 km2. The block is divided into two portions with the southern area located adjacent to the Bontang LNG facility and the northern area located 62 kilometres north of Bontang and adjacent to Dart Energy’s existing Sangatta West PSC. During the first 3-year exploration period, Dart Energy plans to drill three core wells and one pilot well as part of the committed work program. Dart Energy holds 100% working interest and operatorship in Bontang Bengalon, which provides flexibility to introduce new partners to the project over time.
Muralim PSC (Sumatra, Indonesia)
Following drilling of two exploration wells in the previous quarter, review and analysis of core samples is ongoing and the results are expected during 1Q 2013. Subject to results, Dart Energy expects to undertake appraisal drilling during 2H 2013.
Satpura (Madhya Pradesh, India)
A 15-well exploration program has been completed and following that, two pilot wells are currently being drilled. Dart Energy plans to undertake production testing on the two pilot wells during 1H 2013.
Tata Coal Mine Degassing (Jharkhand, India)
Drilling of 3 wells for methane degassing at Tata Steel coal mine at Jamadoba, Jharkhand state commenced during the quarter. First well has been completed which marks Dart Energy’s first service fee revenues from this project. Drilling of second well is underway and Dart Energy expects to complete a three well degassing program during 1H 2013.