Mubadala announced an agreement to farm out 20% interest in the Andaman I and South Andaman gross split contracts, in offshore North Sumatra, to Premier Oil, on 17 July 2019. The deal is subject to customary conditions and approvals. Upon final approval, Mubadala will remain operator of both blocks with 80% interest.  The deal will reinforce the cooperation between Mubadala and Premier in exploring the deep water area of the North Sumatra Basin. The companies are also partnering in the adjacent Andaman II PSC, in which Premier holds a 40% operating interest and Mubadala controls 30%. The remaining 30% in the Andaman II block is held by KrisEnergy.  In May 2019, PGS completed a large multi-client 3D seismic survey across the South Andaman, Andaman I and Andaman II blocks. The new data, covering approximately 9,000 sq km, will improve the understanding of the proven Miocene carbonate and Oligo-Miocene clastic plays and of the deeper, unproven syn-rift plays in the area. The survey, which commenced in December 2018, was acquired using the âPGS Apolloâ S/V.  No exploration drilling has taken place within the Andaman I block, while two unsuccessful wells have been drilled in the South Andaman acreage by previous operators (Lasmo in 2000 and Eni in 2008).  Mubadala signed gross split contracts for the Andaman I and South Andaman blocks in April 2018 and February 2019 respectively, with initial interest of 100% in both blocks.  Background Information  Andaman I block  The Andaman I block was offered as part of the Conventional Oil and Gas Bidding First Round 2017 under the Direct Offer mechanism. Mubadala was awarded the block on 31 January 2018, and contract signature under Gross Split fiscal terms took place in April 2018. The base government/contractor split under Gross Split terms is 57%/43% for oil and 52%/48% for gas, subject to modifiers depending on the specific situation of the block. Signature bonus for the block was USD 750,000.  The block, with an area of approximately 7,400 sq km, is located primarily in the deep water area of the South Sumatra Basin, with the western edge bounded by the Mergui Ridge. No well has been drill to date within the acreage. Exploration targets in the area could be clastic reservoirs of the Upper Oligocene Parapat Formation, Lower Miocene Bampo Formation and Middle Miocene Baong Formation, mostly in structural trap settings.    The minimum exploration commitments for the first three-year exploration period include G&G studies and a 500 sq km 3D seismic survey, for a total value of USD 2.15 million. The seismic commitment was likely fulfilled by the multi-client 3D survey acquired in early 2019.  South Andaman block  The South Andaman block was offered in the Conventional Oil and Gas Bidding Third Round 2018 under the Direct Offer mechanism. Mubadala was announced as the winner of the block on 27 December 2018 and signed the Gross Split contract on 18 February 2019. Signature bonus amounted to USD 2 million.  The block has an area of approximately 3,550 sq km and is located in the offshore part of the North Sumatra Basin, under the Aceh Province jurisdiction. Water depth in the block ranges between approximately 100 and 1,500 m. The block was initially reported by Migas as an active Joint Study Area (JSA) in January 2017.  Potential exploration targets in the block include fluvial to alluvial clastic reservoirs deposited during the syn-rift stage (Parapat, Bampo formations) and post-rift stage (Baong and Keutapang formations), ranging from Oligocene to Upper Miocene.  The minimum exploration commitments for South Andaman include G&G studies and 500 sq km of 3D seismic acquisition, for a total expenditure of USD 2.15 million. The seismic commitment was likely fulfilled by the multi-client 3D survey acquired in early 2019.
Premier confirmed it had signed an agreement with operator Mubadala to earn a 20% interest in South Andaman and Andaman I blocks PSC split PSC.