Andalas Energy & Power Enters Into Services Agreement for the Betun-Selo KSO

Source: www.gulfoilandgas.com 6/21/2019, Location: Asia

AIM-listed Andalas Energy and Power has entered into an operating services and option agreement ('Services Agreement') in respect of the producing Betun-Selo KSO in Sumatra, Indonesia and has also issued a £2 million unsecured, interest-free convertible loan note facility arranged by Optiva Securities. The Betun-Selo KSO comprises the producing Betun field and the non-producing Selo field.

In addition, Andalas has issued the Convertible Note to provide up to £2 million of Group funding subject to draw-down conditions, which may be converted into Ordinary Shares on the election of the Company or Noteholder at an issue price being equal to the higher of 0.15 pence and a 5% discount to the closing bid price on the day immediately prior to draw down.

Simon Gorringe, CEO of Andalas Energy and Power said: 'We are very excited by the Betun Selo KSO opportunity in Indonesia. This provides Andalas with the potential to earn direct access to oil production and revenues, which has always been one of our key objectives. Under the terms of our agreement, ADL may earn into the KSO by committing to workover the four existing Betun wells to increase production.

This opportunity plays directly to our strengths in rejuvenating and optimising late life fields and highlights the skills that exist in our team based in Indonesia. In addition, we believe the Selo field offers substantial upside with a number of highly productive formations that can be accessed by one well. We are very pleased to be working with PT Celebes Artha Ventura (CAV), the major shareholder in PT Petroenim Betun Selo (PBS), the Betun Selo KSO Contractor and are very positive about the opportunity to enter into more oil and gas development and production opportunities with CAV over the longer term.'

Hendrik Kolonas, President Commissioner and CEO of PT Celebes Artha Ventura said: 'We are very pleased to invite Andalas Energy & Power to support us in the development of the Betun-Selo KSO. For some time we have been looking for a strategic partner experienced in oil and gas in Indonesia to work and coinvest with us in optimising production from Betun and developing the Selo field. We are also excited by the possibility of working with a strategic partner on other similar projects in Indonesia.'


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