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16 Apr 2019 | 10:29

Coro Energy completes payment obligations to acquire a 15% working interest in Duyung PSC

Coro Energy completed its payment obligations to acquire its 15% working interest in the Duyung PSC by paying the outstanding cash consideration of $10.5m and issuing the existing PSC shareholders $1.85m in new Coro shares, as previously announced on 11 February 2019.

Coro said it has now paid the existing owners of the Duyung PSC a total consideration of $2.95m in cash and $1.85m in Coro shares as well as providing a $10.5m contribution towards the 2019 exploration and appraisal drilling campaign to earn its 15% interest in the Duyung PSC.

Transfer of title of the 15% PSC interest to Coro's name is subject to customary Indonesian regulatory approval which is expected to follow, with a long stop date of 31 December 2019.

Should regulatory approvals not be forthcoming, Coro agreed to receive transfer of 15% of the shares of West Natuna Exploration, the current owner of the Duyung PSC.

Coro today issued a total of 60,905,037 new ordinary shares of 0.1p each in the company, calculated as the 30-day volume weighted average price of Coro's shares up to the date of signing the acquisition agreement in February, being 2.3492p per consideration share.

Pursuant to the share purchase agreement, the vendors, Conrad Petroleum and Empyrean Energy, agreed not to sell or transfer the consideration shares until the earlier of i) 15 days after the completion of the 2019 drilling program; or ii) Coro having issued a press announcement in relation to the completion of such drilling works.

Application has been made for the consideration shares to be admitted to trading on AIM which is expected to occur on 24 April 2019.

MAKO GAS FIELD, OFFSHORE INDONESIA

The Duyung PSC contains the Mako gas field, a large, shallow structural closure, with an area extent of over 350 square km.

The reservoir is a Pliocene-age sandstone, with a gas-water contact at approximately 391m true vertical depth sub-sea. The field has excellent seismic definition with direct hydrocarbon indicators being very evident.

The Mako field is located in the prolific West Natuna basin, approximately 16 km from the WNTS pipeline system which delivers gas from Indonesia to Singapore.

A plan of development was recently approved by the Indonesian authorities and initial gas marketing discussions have commenced with a gas buyer in Singapore.

An independent report on the field's potential was recently carried out by Gaffney Cline & Associates, giving a 2C recoverable resource assessment of 276 Bcf and 392 Bcf of 3C recoverable resources.

The Duyung PSC partners are planning an exploration and appraisal drilling campaign for the remainder of 2019, in relation to the PSC and will be updating the market shortly with details.

At 10:29am: (LON:CORO) Coro Energy Plc Ord 0.1p share price was +0.15p at 2.25p

Story provided by StockMarketWire.com
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