West Natuna Exploration, a subsidiary of Conrad Asia Energy, signed a binding contract with Duta Marine and Pakarti Tirtoagung to lease a mobile offshore production unit.
The vessel will support development at the Mako Gas Field in the Natuna Sea, located offshore Indonesia.
The contract terms require the conversion of a donor jack-up drilling rig in Batam into a production facility with a raw gas design capacity of 172 million cubic feet (4.87 million cubic metres) per day.
Following mobilisation, the bareboat charter is scheduled to run until January 2037, with provisions for up to five annual extensions.
In addition to operating and maintaining the unit to international classification standards, the contractors will provide crew accommodation and support services.
Under the financial agreements, the partners will make a $4 million down payment to purchase the donor rig and a progressive $26 million payment for facility equipment.
Conrad Asia Energy estimated the total capital expenditure required to reach first gas at $320 million, with West Natuna Exploration holding a 25 per cent share of approximately $80 million.
The development plan incorporates six wells tied back to the production unit, which will transport sales gas through a 59-kilometre, 18-inch (45.72-centimetre) pipeline to the Kakap production sharing contract network.
These equipment down payments are accounted for within a previously announced provision of approximately $35 million. Future operating costs, including pipeline transportation, are targeted by the developer at $70 million to $80 million per annum.
