REG - Empyrean Energy PLC - Gas Sale Agreement Signed with Sembcorp

Empyrean EnergyAnnouncement

02/09/2024 07:00

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RNS Number : 4826C  Empyrean Energy PLC  02 September 2024

This announcement contains inside information

 

Empyrean Energy Plc / Index: AIM / Epic: EME / Sector: Oil & Gas

 

Empyrean Energy plc

 

Gas Sale Agreement Signed with Sembcorp

 

2 September 2024

 

Highlights

 

·      On 31 August 2024, the Mako Joint Venture partners and Sembcorp
signed a binding GSA for the export of gas produced from the Mako field to
Singapore.

 

·      The contract term is until the end of the Duyung PSC in January
2037 and allows for the sale of up to 76 billion British thermal units per day
("Bbtud"), which is equivalent to around 76.9 million standard cubic feet per
day ("mmscfd").

 

·      The GSA also contains provisions for the sale of up to an
additional 35 Bbtud (around 35.4 mmscfd) should a tie-in pipeline not be built
to the Indonesian domestic market in Batam and DMO sales do not therefore
eventuate. The possible export of these additional volumes is recognised in
the Mako plan of development ("POD").

 

·      The terms of the GSA are confidential and are subject to
government approval.

 

 

Empyrean Energy plc ("Empyrean" or the "Company"), the oil and gas development
company with interests in Indonesia and the United States, is pleased to
advise that Empyrean, Conrad Asia Energy Ltd and Coro Energy Plc (together the
"Mako Joint Venture partners") have agreed a binding Gas Sales Agreement
("GSA") for the sale and purchase of the export portion of natural gas from
the Mako gas field with Sembcorp Gas Pte Ltd ("Sembcorp"), a wholly-owned
subsidiary of Sembcorp Industries Ltd, a leading energy and urban solutions
provider, headquartered in Singapore.

The GSA with Sembcorp for gas from the Mako gas field (in which Empyrean has
an 8.5% Participating Interest), is an important next step in the
commercialisation of the Mako field, the largest undeveloped gas field in the
West Natuna Sea. With this GSA and the gas sold under a separate domestic
market obligation ("DMO") GSA with PGN, Indonesia's largest gas company, all
of Mako's current gas Contingent Resources have been committed to gas buyers.

The contract term is until the end of the Duyung PSC in January 2037 and
allows for the sale of up to 76 billion British thermal units per day
("Bbtud") which is equivalent to around 76.9 million standard cubic feet per
day ("mmscfd").

 

The GSA also contains provisions for the sale of up to an additional 35 Bbtud
(around 35.4 mmscfd) should a tie-in pipeline not be built to the Indonesian
domestic market in Batam and DMO sales do not therefore eventuate. The
possible export of these additional volumes is recognised in the Mako plan of
development ("POD ") 1 Revision.

 

Completion of both GSAs is a significant milestone on the path to a Final
Investment Decision ("FID") for the Mako project.

Natural gas is an essential transition fuel in the energy mix across Asia and
the sale of all Mako's contingent resources gas resources represents an
important project in Asia.

The Mako Joint Venture partners and their respective interests are :-

Empyrean Energy plc          8.5%

Conrad Asia Energy Ltd       76.5%

Coro Energy Plc                    15%

 

Empyrean CEO, Tom Kelly, stated:

 

"This export GSA between Sembcorp, the Indonesian Government and the Mako
Joint Venture partners marks the next significant milestone in the pathway
from discovery of Mako towards development and production. Importantly, the
combination of this export GSA with the DMO GSA means that all contingent
resources at Mako are under binding contracts for sale. These GSA's underpin
the commercial viability of the Mako project and its value. We anticipate that
these GSA's will greatly assist parties interested in the Mako project to
assess value and timelines with more clarity and certainty. We look forward to
providing further updates on progress in due course".

 

 

Duyung PSC - Mako Gas
Field
EME 8.5% Participating Interest

Empyrean holds an 8.5% operated interest in the Duyung PSC. Duyung is located
in the Riau Islands Province, Indonesian waters in the West Natuna area,
approximately 100 km to the north of Matak Island and 400 km northeast of
Singapore. The Mako field contains 2C Contingent Resources (100%) of 376
billion cubic feet ("Bcf"), and is scheduled to begin production in 2026. The
West Natuna Sea has been supplying Singapore with natural gas for more than
two decades and Mako is expected to extend this supply for at least another
decade via the existing transportation system.

 

 

Sembcorp
Background

 

As one of the largest players in Singapore's natural gas market and the
country's first commercial importer and retailer of piped natural gas,
Sembcorp offers a wide range of solutions in gas sourcing, importation and
trading. In addition, Sembcorp is an importer of LNG (liquefied natural gas)
for Singapore with the competencies to provide customers access to a global
portfolio of LNG sources.

The information in this announcement has been reviewed by Empyrean's Technical
Director, Gaz Bisht, who has over 32 years' experience as a hydrocarbon
geologist and geoscientist.

 

For further information please contact the following:

 

 Empyrean Energy plc                                               Tel: +61 (8) 6146 5325
 Tom Kelly

 Cavendish Capital Markets Limited (Nominated Advisor and Broker)  Tel: +44 (0) 207 220 0500
 Neil McDonald

 Pearl Kellie

 Novum Securities Limited (Joint Broker)                           Tel: +44 (0) 207 399 9400
 Colin Rowbury

 

 

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