NuEnergy Gas Limited today announced that it is acquiring all the participating interest of partner PT Medco CBM Pendopo (Medco) in the Muralim Production Sharing Contract (PSC). NuEnergy is the operator of the Muralim PSC and holds a 50% participating interest in the Muralim PSC, with Medco holding the other 50% of participating interest.
In the announcement dated 23 January 2019, NuEnergy Gas Limited (ASX: NGY) stated that it has entered into a Withdrawal and Assignment Agreement with Medco to increase its participating interest in the Muralim Production Sharing Contract. The agreement will see Medco withdrawing all its interest in Muralim PSC and transferring the same to NuEnergy.
The announcement read that on the withdrawal from Muralim PSC, Medco will assign all its obligations, rights and liabilities that it is entitled/liable to under the PSC and Joint Operating Agreement. But there is no cost attached to the withdrawal of Medco and assignment to NuEnergy apart from Medco’s obligation. This means NuEnergy will now acquire the remaining 50% participating interest just by settling all the Medco’s expenditure obligation about its outstanding due and unpaid cash calls.
For the year ended 30 June 2018, the company posted a net loss for the year of $12,532,688 in comparison to the 2017’s loss of $4,607,335. The company explained that the increase in the net loss includes a full impairment charge of $11,397,870 on the exploration and evaluation asset recognized for the Rengat Production Sharing Contract.
During the fiscal year 2018, the Indonesian Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) had granted the exploration period extension to NuEnergy after the company met the terms of the extension, including the completion of drilling one exploratory well and undertaking permeability tests on the two existing wells. NuEnergy’s Exploration Period for the Muralim PSC has now been extended for four years to 2 December 2020
NuEnergy and the Indonesian Special Task Force for Upstream Oil and Gas Business Activities have reportedly agreed for NuEnergy to relinquish the Rengat PSC after confirmation from SKK Migas of the completion of the PSC firm commitments, as there have not been attractive commercial discoveries based on the exploration and drilling activities to date.
NuEnergy is an ASX-listed clean energy company that primarily focuses on the development and exploration of Indonesian unconventional gas assets. As at 30 June 2018, the Group had cash and cash equivalents of $1,369,743 and net assets of $38,649,357.
NGY traded flat on 23 January 2019. The stock price last traded at $0.027 with a market capitalization of $39.99 million. Over the past 12 months, the stock has witnessed a negative performance change of 55% including a plunge of 10%.
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