Timor-Leste – Chuditch Project

Drill Plan

• Preparing to drill and test Chuditch-2 in Q2 2025
• Significant step-out, 5.1 km from discovery well
• Predict 149m gas column (v. 30m at Chuditch-1)
• Validate gas resource estimates / production flow test (“DST”)

Sunda Energy’s wholly owned Timor-Leste subsidiary SundaGas Banda Unipessoal Lda. (“SundaGas”) is the Operator of and 60% interest holder in the offshore Timor-Leste TL-SO-19-16 PSC. The remaining 40% interest is held by a subsidiary of the Timor-Leste state oil company Timor Gap, E.P., whose interest is carried by SundaGas to development.

Work Programme and Activities

SundaGas has reprocessed 3D seismic data to the highest modern industry standards, allowing detailed imaging of the Chuditch gas field for the first time.

This work successfully addressed issues with sea-bed topography and shallow geological features that significantly impact the seismic image at the reservoir level local to the Chuditch area, artefacts which earlier seismic processing technologies had been unable to remove. The reprocessing resulted in a considerably enhanced subsurface image, critical for the definition of the size and shape of the Chuditch-1 gas accumulation and offset prospectivity. The interpretation of the reprocessed 3D seismic led to a substantial increase in gas volumes estimates, as well as informing the location of potential future wells.

In parallel with the 3D seismic reprocessing project, additional geological and engineering studies were completed, including:

• Extensive 2D regional seismic interpretation, mapping and petroleum systems modelling exercises to provide regional context to the Chuditch field;
• A revised petrophysical and core evaluation of the Chuditch-1 discovery, confirming the quality of Chuditch reservoirs as potentially gas productive;
• A well engineering study to provide preliminary designs for a Chuditch-1 appraisal well; and
• A Chuditch Field Facilities Definition Concepts report, which identifies, assesses, and compares field development concepts. The study evaluated the layout and costs of the necessary infield facilities, the various pipeline and standalone options for gas export, and the treatment and storage of carbon dioxide.

An operational office was opened in Dili in 2022 with local management and technical teams.

A Competent Person’s Report (CPR) on the Chuditch field was prepared by reservoir consultancy group ERCE and delivered in February 2023. For the Chuditch-1 discovery, ERCE assessed gross Pmean Contingent Resources of 1.16Tcf of gas. The recognition of the resources as being Contingent, rather than Prospective, was a major milestone and set the foundation for the next stage of the project cycle. SundaGas believes that the Chuditch-1 Contingent Resources are potentially sufficiently large to be economically viable to be developed standalone or in parallel with other developments in the region.

In addition, aggregated gross Pmean Prospective Resources attributable to the licence according to the CPR amounted to 1,562 Bcf gas across three prospects, Chuditch SW, Chuditch NE and Quokka. Geological Chances of Success (“GCOS”) for these prospects range from 52% to 26%, providing substantial follow on, low risk exploration potential to any Chuditch-1 development. It is notable that Sunda’s in-house probabilistic estimates of aggregated gross Prospective gas Resources for these prospects, at 2,128 Bcf of gas, are higher that ERCE’s estimates. This arises mainly through the Company’s preferred use of the latest reprocessed seismic data velocity model to define the extent of the prospects.

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In February 2024, it was announced that our partner in the Chuditch project, TIMOR GAP, had completed a Farm-Up such that SundaGas retains operatorship and a 60% working interest in the Chuditch PSC, while TIMOR GAP will have a 40% interest, made up of a new paying 15% interest plus its original 25% interest, which is carried to first gas. Therefore, TIMOR GAP is now responsible for paying 20% of all costs, including the drilling of the planned Chuditch-2 appraisal well. In 2024, this contribution is estimated to be around US$7.5 million. SundaGas received cash payments from TIMOR GAP of approximately US$1 million relating to back costs covering the period from the signing of the PSC to the date of the Farm-Up. 

SundaGas is currently preparing to drill an appraisal well on the Chuditch field. The Chuditch-2 well is scheduled to commence in Q2 2025, with the objectives of validating the resources assessed by SundaGas’ work and the CPR, plus the carrying out of a production flow test (DST) to establish the potential flow rates that may be achieved in an anticipated future development. In April 2024, it was announced that a Site Survey at the Chuditch-2 location had been completed. An operational update was provided on 28 May 2024 with a full description of the status of operational planning. Sunda Energy will continue to provide updates regarding its plans for the appraisal of the Chuditch field.