Pertamina/Medco Simenggaris JOB has completed the South East Sembakung 1 (SES 1) wildcat in the Simenggaris JOA, located in onshore East Kalimantan, possibly around March 2018, with results unreported. The well was likely spudded in December 2017, using Pertamina Drilling Servicesâs âRig #22.2â, with PTD of approximately 1,525 m TVDSS, targeting sandstones of the Tabul Formation. Well operation was estimated to last 43 days and involved and estimated cost around USD 7 million.    The company was reportedly planning for the well program in late February 2017. Socialization activities in preparation for the drilling were conducted on 6 February 2017. Estimated pre-drill resources (P50) for the well were approximately 30 MMbo and 35 Bcfg.    Land acquisition programme was conducted in November 2014 with spud date initially planned for early 2015, however the plan was deferred.    As of late August 2014, the operator was reportedly working with the local government for the issuance of the necessary permit. The administration indicated the intention to support the exploration programme.    Another well, appraisal Bajul Besar 2, was originally planned to be drilled in late 2015, but the plan likely did not go through.    The Simenggaris JOA is expected to supply gas for PT PLN (Persero) for about 11 years at a rate of 25 MMscfg/d, from the South Sembakung field. First gas production could be achieved in 2018. Small volumes of 0.5 MMcfg/d have been produced since November 2015 and delivered to PLN for local power generation. Additional 5 MMcfg/d are committed for sale to Perusda Nusa Serambi Persada for 11 years.  The block is 100% owned and operated by the Pertamina/Medco Simenggaris JOB, a joint venture between Medco (62.5%) and Pertamina Hulu Energi (37.5%).  The previous exploration activity in the block was completed in late September 2013, with the successful testing of the Bajul Besar 1 wildcat. The first DST in the well, in an interval between 879 â 883 m within the Meliat Formation, flowed 9.35 MMscfg/d from a 52/64â choke. Following the first test, the operator planned to conduct two additional test in the Tabul Formation, however no results were released. Bajul Besar 1 was spudded on 1 July 2013 and drilled to 1,585m MD (1532m TVD) in late July 2013. PTD of the well was at around 1,530 m. The operator reported operational expenses for the well of approximately USD 6.8 million until end of August 2013.     Background Information    The Simenggaris JOA was awarded on 24 February 1998 and originally covered an onshore/marginal offshore area of some 2,734 sq km, since reduced by partial relinquishment of fringe areas to 1,423 sq km. Interest holders in the contract area were Western Resources (a subsidiary of CityView Investments of Australia), PT Genindo Citra Perkasa and Pertamina. The contract consists of acreage located immediately adjacent to Total's offshore Sebawang Block I PSC and covers swampland and tidal areas along the coastline of north-eastern Kalimantan. The Simenggaris JOA was awarded on the basis of commitment to a large 10 year work programme of USD 64.21 million, with a minimum three year work programme of US$ 12.3 million which was to involve the drilling of two wells, at least one of which was expected to be an appraisal well to be drilled on the Sesayap 1 gas discovery. Total signature bonuses of USD 450,000 were paid.    The JOA includes the South Sembakung 1 oil and gas discovery drilled by Arco in the 1970s, as well as the small Sesayap 1 gas discovery also drilled by Arco at that time. South Sembakung 1 flowed 100 bo/d plus 10 MMscf/d but went un-appraised, while Sesayap 1, drilled in 1978, was unsuccessfully appraised by the Sesayap 2ST well in 1979. Reserves in the later discovery were believed to be in the range of 200-300 Bscf.    On 21 February 2002, the JOB spudded Pidawan 1, its first well in the block. The well was drilled to TD at 2,287m and tested. DST 1, between 1,945-1,948m, flowed 2.87 MMscf/d on a 2" choke and DST 2, between 871-874m, flowed 1.6 MMcf/d on a 28/64" choke (provisional results). Pidawan 1 was temporarily suspended as a gas discovery on about 16 July 2002. Oil shows were observed in the 8-1/2" hole section and gas readings of 116 units at 743m, 174 units at 795m, 134 units at 821m and 184 units at 878m were reported while drilling the Tarakan and Santul formations in the 12-1/4" hole section. Pidawan 1 was targeting Middle to Late Miocene sandstones of the Santul, Tabul and Meliat formations in a south-west to north-east normally faulted four-way dip closed structure, the success rate of the well being estimated at 38%. The PTD of the well was 2,300m and recoverable reserves had been quoted as 52 MMbo plus 91 Bscf. The well is located 17km south-east of the Sembakung oil and gas field.     In July 2004, the JOB completed the acquisition of a 512km 2D seismic survey in the adjacent Bengara I PSC. The survey also covered prospects within the Simenggaris JOA.    In late August 2008, partner Salamander Energy reported that the Plan of Development (POD) for South Sembakung field had been formally approved. It was submitted in March 2008 following a successful appraisal campaign in the second half of 2007. The field has 2P recoverable reserves estimate of 125 billion cubic feet of gas and 3 million barrels of condensate. It is located approximately 7 km south west of the producing Sembakung oil and gas field.     On 4 August 2009, PT Pertamina/Medco Simenggaris JOB signed a gas sales and purchase agreement with PT Pertamina Gas (Pertagas) and PT Medco Gas Indonesia for the supply of 20 MMscfg/d from the South Sembakung field, to the Bunyu methanol plant. The contract is for 11 years at a minimum price of USD 3/Mscfg with an inflator indexed to methanol prices. Production from the field was initially expected to commence in late 2011 at an initial rate of 15 MMscfg/d for 12 months, increasing to around 25 MMscfg/d thereafter. The Bunyu methanol plant, which is owned by Pertamina but was operated by Medco, has been suspended for years due to lack of gas supply.    An additional Gas Sales and Purchase Agreement was signed in early October 2012. The deal called for the sale of 5 MMscfg/d, possibly coming from one well, to local firm Perusahaan Daerah Nusa Serambi Persada for power generation in Nunukan, East Kalimantan. Gas will be sold for 11 years, with start date initially set on 2013, at a price of USD 5.2 per BBtu with a 3% annual escalation. Negotiation has been ongoing for another gas contract covering 11 years and supply of 25 MMcfg/d, possibly coming from the other development wells that have been drilled within the block in 2011. A previous agreement was initially signed in 2009 for the sale of 20 MMscfg/d to the Bunyu methanol plant, located 17 km away from the field.    On 11 March 2013, a swap agreement, involving PT Medco Energi Internasional and Salamander Energy, was reported wherein Salamander would acquire Medcoâs 15% stake in Bangkanai PSC and in return Medco would get Salamanderâs 21% stake in the Simenggaris JOA and 41.67% in the Bengara I PSC. As a result, Medco obtained 62.5% interest in the Simenggaris JOA upon approval with Pertamina owning the remaining 37.5% stake.
South East Sembakung 1 (SES 1) Medco 62.5%, Pertamina 37,5%) in the Simenggaris JOA, has completed with results unreported