Conrad Asia Energy Increases Stake in Duyung PSC to 91.5%

Jane Morgan Management

Conrad Asia Energy Ltd (ASX: CRD), an ASX-listed Asia-focused natural gas exploration and development company, today announced the successful resolution of a long-standing joint venture issue with Coro Energy, resulting in a significant increase in Conrad’s participating interest in the Duyung Production Sharing Contract (PSC) to 91.5%.

The milestone follows the approval by Coro shareholders of a Settlement Agreement, which sees Coro Energy transfer its 15% stake in the Duyung PSC to Conrad’s wholly owned subsidiary, West Natuna Exploration Limited (WNEL). The agreement resolves historic cash call arrears and simplifies the joint venture structure.

Key terms of the settlement include:

• Conrad’s operated interest in the Duyung PSC increasing to 91.5%;

• A cash payment of US$300,000 from Coro to WNEL;

• Issuance of 500,000 Conrad shares to Coro (valued at approx. US$225,000);

• Future issuance of additional Conrad shares worth US$750,000 upon first commercial production; and

• Full release of Coro from further cash call obligations.

Commenting on the development, Conrad Managing Director and CEO, Miltos Xynogalas, confirmed:

“Approval of the Settlement Agreement by Coro shareholders resolves a long-standing dispute regarding the payment of outstanding cash calls arrears between Conrad and Coro. The increase to 91.5% PI provides the company with flexibility in its farm out and project financing options thus enhancing its ability to bring the Mako project to FID.”

Completion remains subject to final approval from Indonesia’s Ministry of Energy and Mineral Resources (MEMR).

Located in the Natuna Sea, offshore Indonesia, the Duyung PSC hosts the Mako Gas Field – one of the largest undeveloped shallow water gas discoveries in the region. Post-transfer, Conrad’s net 2C Contingent Resources from Mako increase to 231 billion cubic feet (Bcf), up from 193 Bcf previously.

The Company continues discussions with Empyrean Energy regarding resolution of outstanding cash call arrears.

ENDS

Conrad is an Asia-focused natural gas exploration & production company concentrated on the shallow waters offshore Indonesia, and via its wholly owned subsidiaries, is the holder of several operated tenements in the form of Production Sharing Contracts. The Company’s flagship project is the Mako Gas Field located in the Natuna Sea in the shallow offshore waters of Indonesia. The Mako gas field is one of the largest gas discoveries in the region.

The Company specialises in the identification and acquisition of undervalued, overlooked, and/or technically misunderstood gas assets, and has developed expertise in maturing such assets through subsurface technical work, appraisal drilling and an innovative approach to low-cost field development.

The Board and management have a proven track record of value creation and deep industry experience with oil majors, midcap E&P and the upstream investment community, together with a successful track record of bringing exploration and development projects into production, with Peter Botten the founder and Chairman of Oil Search adding enormous depth and experience as Chairman of Conrad.

Jane Morgan
Director
P: +61 405 555 618
[email protected]