Lion Energy Limited (ASX: LIO), is based out of Subiaco, Australia and engaged in the exploration, development, and production of oil and gas in Indonesia along with its subsidiaries.
Recently, the company informed the market that the technical works are underway at the East Seram Production Sharing Contract (PSC), which had resulted in the discovery of a significant increase in the prospective resource estimate with combined P50 (best estimate) recoverable potential resources of over 1.24 billion boe.
Prior to this, in September 2018, Lion had reported P50 prospective resources of 0.77 billion boe. Of late, the addition of two new onshore Manusela carbonate leads comprising Wahai Deep and MA-11, has taken the portfolio to 100 mmboe plus leads which is inclusive of MA-7, Tanah Baru South and Lofin NW. Moreover, two other significant offshore leads (PP-4, PP-5) have been discovered with shallow targets (<1000m) and closures up to 30 km2.
As of date, the company holds a 100% participating interest in 6510-km2 East Seram Production sharing contract (PSC), situated on the Seram Island in Eastern Indonesia. This PSC contains the SE extension of the 2 TCF Lofin field and the offshore extension of the 20 mmbbl Bula Field. A500 km 2D seismic survey is scheduled for 2020 for these field extensions as well as high graded prospects and leads.
The planning for the survey is already underway, and the company is certain that there would be a suite of drill-ready targets on completion of the survey which will position the East Seram PSC as one of the most yielding and exciting blocks in the SE Asian region. For a successful survey, the company is also seeking to find a well-resourced partner to join them in their exploration and development spree.
Besides, the company also holds stake (40.7%) in the South Block PSC comprising Area 1 and Area 2, located in the North Sumatra Basin.
As per the Mining exploration entity and oil and gas exploration entity report for the quarter ended December 31st, 2018, the company net cash and cash equivalents stood at USD 1.030 million. There were cash outflows from operating activities at around USD 475K mainly resulting from payments for exploration & evaluation, development, production, staff costs as well as administration and corporate costs. Moreover, the investing activities also led to cash outflows of USD 60K due to farm out costs. There were no financing activities in the last quarter, but the cash inflows retrieved from proceeds from the issue of shares in the prior fiscal year resulted in a favourable net cash position. The company also estimates the cash outflows for the next quarter to be around USD 302K.
Lion Energy has a market cap of AUD 5.81 million with approximately 207.4 million outstanding shares. The LIO stock is currently trading at AUD 0.028 on 5 March 2019 (1:00 PM AEST). LIO has so far generated a negative YTD of 6.67%.
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