Conrad Asia Energy's Aceh Gas Commercialisation Progress
CRD (CRD) Share Update November 2024 Tuesday 19th
Conrad Asia Energy Updates on Aceh Gas Commercialisation
Conrad Asia Energy Ltd (ASX: CRD) has announced significant progress in the commercialisation of its offshore Aceh gas resources, focusing on small-scale LNG projects.
Instant Summary:
- 214 Bcf of 2C Contingent Resource in Aceh PSCs.
- Memorandum of Understanding with Indonesia's PGN.
- Feasibility of small-scale LNG plant confirmed.
- Potential market includes local mining companies.
- Upcoming 3D seismic survey to enhance resource estimates.
Resource Estimates and Partnerships
Conrad Asia Energy Ltd has reported a 2C Contingent Resource estimate of 214 billion cubic feet (Bcf) of sales gas in its Offshore North West Aceh (ONWA) and Offshore South West Aceh (OSWA) PSCs. The company holds a 100% interest in these PSCs, which cover shallow-water gas discoveries.
In February 2024, Conrad entered into a Memorandum of Understanding (MOU) with PT Perusahaan Gas Negara Tbk (PGN), Indonesia's largest gas company, to collaborate on gas provision for LNG from the Aceh discoveries. This partnership aims to further develop small-scale LNG infrastructure.
Small-Scale LNG Feasibility
Conrad commissioned THREE60 Energy to conduct a Screening Study, which confirmed the technical and commercial feasibility of a small-scale LNG plant with a capacity of less than 0.5 million tonnes per annum. The study indicates that small-scale LNG is a viable option due to the proximity of the gas resources to the shore and the high methane content of the gas.
Several companies in Asia have successfully implemented small-scale LNG projects, supporting sales gas supplies of 20-40 million standard cubic feet per day. Conrad plans to work with PGN to mature this opportunity and explore other commercialisation options such as gas to power and compressed natural gas.
Future Prospects
Conrad's Aceh PSCs also hold significant exploratory potential in deep-water areas, with prospective resources estimated at 15 trillion cubic feet (Tcf) of recoverable gas. The company is preparing for a 3D seismic survey to enhance resource estimates and is seeking a farm-in partner for deeper water exploration.
The collaboration with PGN and the feasibility of small-scale LNG projects position Conrad to capitalize on the growing gas market in Aceh, which includes potential buyers from the mining industry.
The announcement of progress in small-scale LNG projects is likely to positively impact Conrad's stock by showcasing its ability to commercialise its gas resources effectively. The partnership with PGN, a major player in Indonesia's energy sector, adds credibility and potential for successful project execution.
Investor Reaction:
Analysts are likely to view this development positively, given the strategic partnership with PGN and the feasibility of small-scale LNG projects. The potential market for gas in Aceh and the upcoming 3D seismic survey provide further upside potential.
Conclusion:
Investors should keep an eye on Conrad's progress with its small-scale LNG initiatives and upcoming seismic survey results. The company's strategic partnerships and resource potential in Aceh present significant opportunities for growth.