WNEL negotiates farm-out to advance development of Mako gas field offshore Indonesia

Conrad Asia Energy subsidiary West Natuna Exploration Ltd. (WNEL) has signed an agreement to farm out a 75% interest in the Duyung PSC offshore Indonesia to Nations.

Pending government approvals, WNEL will retain a 25% operated interest and expects to be fully carried for Phase 1 development costs of the Mako gas field in the West Natuna Sea through to commercial production.

WNEL anticipates capex of $320 million for the initial development, and it is aiming for first gas in late 2027.

Previously, the company agreed to acquire the 15% stake held by Coro Energy Duyung (Singapore) in Duyung. But last week WNEL issued a withdrawal notice to Empyrean Energy concerning its 8.5% share of the production sharing contract, citing cash calls unpaid since October 2023 (which Empyrean is contesting).

Assuming both arrangements are resolved, WNEL said it would hold a 100% interest in Duyung prior to completing its transaction with Nations.

“The development of the Mako gas resource will establish Conrad as a developer and producer of gas where it can leverage its operating capabilities into the development of its other discovered resources and deliver a visible growth profile through the end of the decade and beyond," said Conrad Managing Director and CEO Miltos Xynogalas. “Conrad’s two-pronged strategy remains unchanged: to bring Mako successfully into production, and in parallel, to focus on the multiple exploration, appraisal and development opportunities in its two 100%-owned Aceh PSCs. Conrad anticipates moving to a plan of development for the existing shallow-water discoveries in Aceh.”