Sunda Energy, the AIM-quoted exploration and appraisal company focused on gas assets in Southeast Asia formerly known as Baron Oil, has delayed the start of drilling operations for the Chuditch-2 appraisal well off Timor Leste to the second quarter of 2025
Sunda Energy, which holds a 60% working interest and operates the TL-SO-19-16 Production Sharing Contract (Chuditch PSC) offshore Timor-Leste through its wholly owned subsidiary company SundaGas Banda Unipessoal, has delay the drilling of the Chuditch-2 well, principally due to overrunning drilling activities of other operators using the preferred rig.
Against this background, Sunda said it continues to seek to achieve the best deal for the procurement of the drilling rig. Significant progress has been made in the negotiations for the preferred drilling rig, with contract discussions having now reached an advanced stage. In addition, contracts are near complete for all key long lead drilling equipment items.
On the funding side, Sunda and Pacific LNG have continued to make progress in the investment process through which Pacific LNG intends to provide funding for the Chuditch PSC project
The parties entered into an exclusivity agreement on August 12, 2024. The proposed funds to be raised from Pacific LNG’s investment, which is anticipated to be through an equity issuance in a Sunda subsidiary company and not at the Sunda Energy Plc level, would be deployed towards appraisal drilling on the Chuditch field and anticipated subsequent development of the Chuditch PSC project.
There can be no guarantee that a definitive agreement in relation to Pacific LNG will be entered into, nor can there be any guarantee on the terms, structure or timing of any potential investment, the company said.
All other aspects of operational planning are progressing well. Extensive geological and engineering studies in support of drilling operations are ongoing, addressing all aspects required to achieve operational objectives including well testing, whilst avoiding geological hazards and focussing throughout on health, safety and environmental protection.
As part of preparations for the Chuditch-2 appraisal well, Sunda is preparing to acquire an Environmental Baseline Survey.
This forms a key part of the ongoing process of environmental licencing to ensure operations at the Chuditch PSC project comply with the applicable law in Timor-Leste.
Subject to vessel availability, this survey is scheduled to take place during the fourth quarter of 2024.
“We are pleased with the continued progress being made at our Chuditch PSC project as we move towards drilling Chuditch-2. We remain confident that our ongoing discussions with Pacific LNG, combined with our strong government relationships in Timor-Leste, will enable us to deliver on the project’s significant potential,” said Andy Butler, Chief Executive Officer.
Timor Gap is Sunda’s partner in the Chuditch PSC, and holds the remaining 40% interest.