REG - Coro Energy PLC - Update re Duyung PSC

Coro EnergyAnnouncement

31/01/2024 07:30

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240131:nRSe5046Ba&default-theme=true

RNS Number : 5046B  Coro Energy PLC  31 January 2024

31 January 2024

 

Coro Energy Plc

("Coro" or the "Company" and together with its subsidiaries the "Group")

 

Update re Duyung PSC

 

Coro Energy PLC, the South East Asian energy company with a natural gas and
clean energy portfolio, notes the announcement released by Conrad Asia Energy
Ltd ("Conrad" or the "Operator"), the holder of a 76.5% operated interest in
the Duyung Production Sharing Contract (PSC), offshore Indonesia, in which the
Group has a 15% interest.

 

In its announcement, the Operator provided an update in respect of, inter
alia, activities in respect of the Mako gas project within the Duyung PSC
during the quarter ended 31 December 2023. In doing so, the Operator has
provided an update on the expected capital costs of the Mako development
project and associated project timings.

 

An extract of the Operator's announcement in respect of Duyung PSC
developments is set out below:

 

·    Considerable progress has been made in maturing the Mako project
during the past months. The key developments include:

 

·    Front end engineering design ("FEED") studies for the Mako
development project have concluded. Based on these studies (and the
procurement process to date), capital costs for Phase 1 are currently
estimated to be US$325 million based on a 100% participating interest, in line
with market trends. Capital expenditures to initial revenues are currently
estimated to be US$250 million (100%). Project costs and expenditure
scheduling are being further optimised to reduce this amount. The planned
development wells are targeted to deliver 120 mmscfd (100%) for a plateau
period of seven years.

 

·    In Q3 2023, the Company signed a non-binding term sheet (the "Term
Sheet") with Sembcorp Gas Pte Ltd ("Sembcorp"), a major Singapore energy
company, which outlines the core terms and serves as the basis for negotiating
a definitive Gas Sales Agreement ("GSA"). Subsequent commercial negotiation
between the Minister of Mining and Natural Resources and Sembcorp has resulted
in both improved price formula and a delay in executing the GSA, and
accordingly, Conrad has agreed with Sembcorp to delay the deadline to finalise
a binding GSA (which will be subject to customary conditions precedent) by the
end of Q2 2024.

 

·    During the quarter, Conrad progressed the technical and commercial
work with the West Natuna Transportation System ("WNTS") Joint Venture and
with the support of SKK Migas to negotiate the commercial and legal terms of
access to the WNTS for the transportation of the Mako gas to Singapore.
Despite the good progress, delays have been encountered and this has required
a revision of the project timeline and finalisation of the GSA.

 

·    While the Company continues to strive to reach a Mako final
investment decision ("FID") at the earliest, on the current trajectory of
conclusion of the GSA and gas transportation agreement, FID would be delayed
until mid-2024. Production start-up would commensurately slip until mid-2026.

 

·    The  Conrad  Duyung farm down process is progressing. With the
announcement of the Term Sheet, as well as progress on all other facets of the
project, more parties have expressed interest in the Mako project. The Company
is engaging in confidential discussions with potential partners regarding
acquisition of a Participating Interest in the Duyung PSC.

 

·    Conrad has appointed a financial advisor to assist with the debt
funding portion of its share of the Mako project capital cost. Conrad has
received an indicative term-sheet from one of the potential lenders to help
fund Conrad's share of project costs. Lender selection and completion of
documentation are expected by mid-2024.

 

 

James Parsons, Chairman, commented:

 

"The improved GSA price formula and optimised capital expenditures (with the
introduction of staged production start-up) underpin both the robust economics
of the Duyung PSC and the likely attractiveness of the project to debt
providers and potential farm in partners. We eagerly await the outcome of the
farm out process and in the meantime will continue to progress the growth of
our renewables portfolio at pace building on our recent progress in both
Vietnam and the Philippines."

 

For further information please contact:

 

 Coro Energy plc                                          Via Vigo Consulting Ltd

 James Parsons, Executive Chairman

 Cavendish Capital Markets Limited (Nominated Adviser)    Tel: 44 (0)20 7220 0500

 Adrian Hadden

 Ben Jeynes

 Hybridan LLP (Nominated Broker)                            Tel: 44 (0)20 3764 2341 (tel:(0)20%C2%A03764%202341)

 Claire Louise Noyce

 Gneiss Energy Limited (Financial Advisor)                  Tel: 44 (0)20 3983 9263

 Jon Fitzpatrick

 Doug Rycroft

 Vigo Consulting (IR/PR Advisor)                          Tel: 44 (0)20 7390 0230

 Patrick d'Ancona

 Finlay Thomson

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the UK version of the EU
Market Abuse Regulation 596/2014 which is part of UK law by virtue of the
European Union (Withdrawal) Act 2018, as amended and supplemented from time to
time. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDDFLBXZFLLBBB