Indonesia Energy Corporation (INDO) ("IEC"), an oil and gas exploration and production company focused on Indonesia, announced that it has discovered oil in its "Kruh 26" well after having announced in July the discovery of oil in its Kruh 25 well. These are 2 back-to-back discoveries of oil for IEC from its previously announced new drilling plans. IEC now plans to conduct stimulation work and commence production from both wells in October 2021.
It is expected that when full production from these 2 new wells is achieved (which is anticipated to occur by the end of October) that such production is expected to increase IEC's overall daily revenues and oil production by over 100%.
IEC also announced that the Kruh 26 well took only 18 days to drill to a total depth of 3,376 feet, which is approximately half of the time that was budgeted. Both Kruh 25 and Kruh 26 were drilled under the previously announced budget of $1.5 million per well.
Additionally, approximately 111 feet of oil sands were encountered at Kruh 26 between the depths of 3,100 and 3,228 feet. This oil-bearing interval (meaning the top of the oil zone to the bottom of the oil zone) in the Kruh 26 well was thicker and therefore larger than anticipated, meaning that the total reserve potential could be larger than anticipated.
Mr. Frank Ingriselli, IEC's President, commented "The Kruh 26 well is a significant achievement for our company, which has now completed 2 discovery wells in less that 60 days. The plan is to now stimulate and commence production next month from both wells, which is expected to double our company's daily revenue and production. This will set us up to drill the third well for the 2021 drilling program, known as "Kruh 27", in the fourth quarter. We look forward to continuing to deliver on our development plans and maximize returns on our investments to grow shareholder value."
IEC also announced an update for its overall drilling program at Kruh Block. Previously, IEC announced that its three-year plan was to drill a total of 18 wells over a three-year period, with 5 of those wells drilled in 2021. IEC still plans to drill a total of 18 wells over the three-year period with 3 of those wells in 2021 and the balance of 15 more wells over the balance of the remainder of the three-year period. This slight delay was primarily caused by the permitting process in Indonesia as well as COVID-19-related delays.