October 5, 2015 – South East Asia-focused oil and gas exploration and production company Mandala Energy has signed an agreement to acquire 35% interest in the Lemang production sharing contract (Lemang PSC) from Ramba Energy’s subsidiary, PT Hexindo Gemilang Jaya, for $179.6m.
Located in Sumatra, Indonesia, the Lemang block is 59% owned by Hexindo while the remaining is owned by Eastwin Global Investments.
The deal involves payment of $26.25m in upfront cash, sliding-scale future subject payments based on certification of oil and gas reserves, undertaking Ramba’s share of three exploration wells; and a cash payment upon first new exploration discovery.
The transaction is subject to the approval of the Government of Indonesia.
Separately, Hexindo has agreed to acquire 15% stake in Lemang PSC from Eastwin.
Ramba CEO David Soeryadjaya said: “Mandala and Ramba’s collaboration is a unique coming-together of two partners with complementary skillsets, which we both look forward to leveraging.
“Despite the current low-oil-price environment, this partnership validates Ramba’s overall strategy and the positive economic returns we expect from the Lemang block. We look forward to a long-term partnership which goes beyond just Lemang.”
Upon completion of these transactions, Mandala, Hexindo and Eastwin will have 35%, 31% and 34% interest respectively in Lemang PSC.
Mandala CEO Barry O’Donnell said: “Combining Ramba’s local relationships and knowledge with Mandala’s technical and operational strengths will provide an ideal platform for securing early production whilst pursuing significant upside potential in the Lemang project.”
Hexindo is 80.4% owned by Indonesia-focused oil & gas exploration and production company Ramba Energy.
Ramba will work with Mandala to commence production of the Akatara field located in Lemang block, in the near term.
The field secured development plan approval from the Indonesia Energy and Mineral Resources Ministry and Indonesia’s upstream oil and gas regulator Satuan Kerja Khusus Minyak dan Gas (SKK Migas).
The project is expected to contribute to the Indonesia’s aim to boost national production.