Bass Oil Looking to Unlock Indonesian Potential
THE CONFERENCE CALLER: Bass Oil (ASX: BAS) is a growth-focused oil production company operating in the prolific South Sumatran basin of Indonesia. By Jack Baker
Speaking at the RIU Good Oil conference in Perth, Bass Oil managing director Giustino Guglielmo spoke of why the company had made its venture into Indonesia.
He summarised it as being, “simple, low-cost and profitable” with multiple opportunities.
Gulgielmo said the company was in a very exciting place to be and they are generating free-cash flow that is paying all the bills in Indonesia and their overheads in Melbourne.
He said their Indonesian asset would likely be self-funding with the last of their payments due in December 2018.
Bass was formerly a Gippsland Basin exploration company that found itself stranded with an acreage position that they couldn’t do anything with after the 2014 downturn.
Over the last two years they searched for an acreage position with which they could give the company rebirth.
Unable to find a position in Australia that made sense, Bass Oil approached their largest shareholder, Cooper Energy, on the potential for Bass to be a vehicle for Coopers’ international portfolio.
Bass acquired Coopers’ 55 per cent stake in the Tangai-Sukananti KSO in Indonesia on what Guglielmo referred to as, “favourable terms”.
The property was producing between 300 to 500 Barrels of oil a day (BPD) through the last year. Bass started production optimisation work and got production back to 600 BPD.
Gulglielmo said the KSO is long-life with a significant amount of time to extract hydrocarbon resources, expiring in 2025.
The company’s first objective, however, is to continue production optimisation over the next 12 months, while keeping production at or above current levels.
The production of 600 BPD comes from thee wells only, driven largely by two key wells.
Guilgelmo recounted an anecdote of his noticing the pressure of a wellhead that was producing 50 to 55 BPD.
He opened the choke, descaled the pipe and got the well production back a week later to 300 BPD.
Guglielmo described Indonesia as a, “slow place to work” with the need to plan ahead.
The company’s offices are in Jakarta and the field team is all-Indonesian and Guglielmo described the work culture as being quite linear, with optimism on the company’s ability to parallel plan and reduce any bottlenecking.
Bass Oil has taken underway a fully integrated study including static and dynamic modelling that Guglielmo said will come up with significant findings.
He described two other potential wells as being, “no-brainers”.
Guglielmo said the company has also uncovered another potential site and was engaged in finding any reason why oil wouldn’t be there.
The company will explore the site in its 2018 drilling programs with targets identified through 3D seismic testing.
There are several fields that surrounds Bass’ KSO and it is currently engaged in forming relationships with other Indonesian companies.
Guglielmo described the potential partners as being impressed with the work done by Bass at Tangai-Sukananti.