Sunda Energy PLC (AIM:SNDA) earlier this week advanced its project in Timor-Leste, where it signed a memorandum of understanding (MOU) with the Ministry of Petroleum and Mineral Resources for the development of the Chuditch gas field.
Chief executive Andy Butler joined the Proactive studio to talk about this milestone.
Here’s we take a look what was said.
Proactive: Andy, very good to speak with you. A big milestone for the company; you've signed a memorandum of understanding for the potential development of Chuditch, and that’s with the Timor-Leste Ministry of Petroleum and Mineral Resources.
Take us through the MOU and what it entails.
Andy Butler: Yes, I’ve just come from signing that MOU this afternoon with both Minister Francisco and President Luis Suarez, the head of Timor Gap, the national oil company, and our joint venture partner.
This is a big milestone for us and very exciting news. There are several aspects to it that I'll highlight.
Firstly, I’ve often talked about the strength of alignment we have with the government, the depth of collaboration we enjoy, and the fact that we all want to move forward together quickly.
This MOU is a great example of that. We have very strong relationships, and the regulator ANP is extremely supportive.
This framework allows us to have close discussions. The concept is great. The asset is a high-quality gas asset with great reservoirs in shallow water, making it something that could be produced easily.
However, the outstanding question has been: what are we going to do with the gas? How do we take it forward in a sensible timeframe?
This agreement goes a long way toward answering those questions. A tie-in to the Bayu-Undan field through shallow water is a straightforward concept. That field has existing facilities to receive the gas, and this gives us strength in planning.
We believe we can bring it onstream by 2028.
Taking the gas onward to facilities on the south coast of Timor-Leste, as the government plans to do, is a great step forward for both Timor-Leste and us. The MOU includes feasibility studies focusing on reservoir engineering, surface facility requirements, and pipeline needs to cross the border. This work is already underway and should be completed by April next year.
Proactive: Andy, earlier this week, you also announced a letter of intent for a drilling rig. Can you take us through how the drilling preparations are going?
Andy Butler: We did indeed announce that letter of intent. It is part of our contract negotiations for a drilling rig already in the area, which is ideal for our appraisal well scheduled for Q2.
That’s progressing nicely and is a milestone in itself.
Other aspects of procurement are also going well. We’ve secured most of the long lead items and onboarded additional team resources.
We now have a full drill team working hard to ensure everything is ready.
Our close collaboration with the regulator ANP has been invaluable in permitting and other preparations. We will conduct an environmental baseline survey early next year, slightly delayed, but we remain on schedule.
Proactive: Are those the next milestones we’re looking at in 2025?
Andy Butler: They are. I should also mention that we applied for new licenses in the Philippines. We expect to make announcements on these soon.
While we initially guided that it would happen by the end of this year, it’s now likely to be early 2025.
Once we have more information, we’ll let everyone know.
Proactive: Keep us updated on any developments. Andy, thank you very much for speaking with us today.