INTERNATIONAL upstream oil and gas firm
Kulczyk has announced that it will be drilling up to three new wells in Brunei
for 2012, and remains optimistic of prospects in Brunei despite a "lack of
commercial success".
President
and chief executive officer of Kulczyk Oil Ventures Inc (KOV) Tim Elliott said
in a media release announcing the company's year-end financial & operating
results that "2011 was a successful year for KOV with the company gaining
significant momentum as the year progressed.
"During
2011, we clearly demonstrated our operating expertise which has manifested
itself in continued increases in net production and revenues."
Elliot
said the company is planning to drill up to six wells in Ukraine and to start
on a five-well drilling programme in Brunei.
"The
company is well positioned for future growth in production, cash flow and
reserves and we look forward to sharing our operating results with investors in
the coming months," he said.
KOV is
planning to start drilling one well in the second or third quarter of 2012 in
Block L, and the drilling of up to two additional wells are planned in 2012 in
Block M.
"In
Block M, we expect to have met all commitments under Phase 1 and to have
progressed on our commitments under Phase 2 of the exploration program,"
said KOV, and is seeking for an extension on Block M in order to complete the
work commitments.
In
Block L, KOV is currently undertaking a seismic acquisition program and it
expects to be close to initiating its Phase 2 drilling programme, scheduled to
follow the drilling activity in adjacent Block M by the end of 2012.
The
statement revealed that during the year ended December 31, 2011, KOV incurred
US$39.8 ($51.7) million in capital expenditures on exploration and evaluation
assets and on property, plant and equipment, including costs incurred on
projects which include the testing of Lempuyang-1 well in Block L and the
processing of seismic data acquired in 2010 for Block M.
KOV's
statement also said that it experienced "material changes" in both
Blocks L and M.
"In
Block L, the acquisition in December 2011 of AED Southeast Asia enabled KOV to
increase its ownership position to 90 per cent and become the block's operator.
In addition, the exploration period of the production sharing agreement (PSA)
was extended by 12 months to August 2013, providing more time to complete the
on-going 3D seismic acquisition programme and to drill the two remaining
commitment wells," it said.
As for
Block M, a third party acquired the company operating the block and the new
operator is currently seeking a rig to commence a three well drilling program,
scheduled for 2012, although timing remains unpredictable given rig
availability issues.
"Brunei
is located in one of the world's most prolific hydrocarbon provinces and,
despite a lack of commercial success so far, we believe our perseverance will
ultimately be rewarded with success," KOV said.
KOV
owns working interests in two production sharing agreements which gives it the
right to explore for and produce oil and natural gas from Block L and Block M.
KOV
owns a 90 per cent working interest in Block L, a 2,220 square kilometre area
covering onshore and offshore areas in northern Brunei, and a 36 per cent
working interest in Block M, a 3,011 square kilometre area onshore in southern
Brunei.
The two
blocks are owned and regulated by PetroleumBRUNEI.
For the
FY 2011, KOV's gross revenue from hydrocarbon sales increased by 395 per cent
to US$35.2 million, from US$8.9 million in 2010. Its total assets also saw an
increase of 12 per cent to US$220.2 million compared to 2010's US$197.3
million.
GOH DE
NO
The
Brunei Times
Business & Investment Opportunities
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