OPERATIONS
The Company operates through its private and public subsidiaries. The total 2012 capital Budget is about $150 Million, before considering certain planned acquisitions in USA and other part of the world. In Indonesia, the Company operates through Blue Sky Langsa Ltd, a private company incorporated in Mauritius. Blue Sky Langsa’s 2012 capital budget is about $125 Million. The majority amount to be spent on developmental drilling and certain oil and gas acquisitions. In Pakistan the Company operates through Blue Sky Pakistan Inc, the emphasis in Pakistan is to produce maximum power, in view of the overwhelming power demand of the country, through its 138 MWatts Power plant located in Shekihupura. In addition, continue to carry on exploration on concession lands. The capital budget in Pakistan consists of about $5 Million for the year 2012. In USA, the Company has embarked to carry out exploration and developmental drilling in offshore and onshore USA. In addition, the plan consists of the sale of all the c store operations in USA. The 2012 budget for USA is about $15 Million.
The principal operation in each country and the companies engaged in such operations are listed below.
Indonesia
The Company has committed to acquire controlling interest in Indonesian company, where the management is arranging funding for about $75 Million. These funds shall be available for the Company to carry out certain capital programs in Indonesia.
Blue Sky Langsa Ltd
Blue Sky Langsa Ltd, (“BSL”) was incorporated in Mauritius in 2003 as Medco E/P Langsa Ltd and changed its name to Blue Sky Langsa ltd in 2009. BSL operates an offshore producing field about 100 KM east of the giant Arun Oil/Gas field in N Sumatra. The field is described as Langsa TAC, East Aceh, and Indonesia and is located in about 300 feet of water depth. BSL’s sole asset is Langsa TAC.
Since 2001, the field has produced about 4 Million barrels of oil (with three year stoppage) from 3 wells. From various studies completed by external and internal studies, it is forecasted that Langsa TAC has some 10 Million P1/P2 barrels of Oil remaining to be produced of which Proved are 4.7 Million barrels and Probable are 5.3 Million barrels. As the time remaining for the lease expires in 6.5 years, immediate measures need to be taken to produce the remaining economic reserves. Based on the historic data, if development plan is implemented by mid 2012, then more than 80% of the proved/probable can be produced before expiry of the contract. We plan to drain the field by drilling one additional well (H5) and extending Horizontal leg for L1/L2/L4 to enter the porous zones to yield better quality reserves. In addition, plan is to return H3 on production, (never produced). The current production from Langsa TAC is from one well at 412 BOPD.
Additional potential exists in Langsa TAC, by extending the term of the contracted area and shooting 3D seismic over certain anomalies which have been identified by our staff and where additional large structure may exist containing in excess of > 80 million barrels OOIP.
BSL plans to file a plan of development with Pertamina (“POD”) by is Q 2012 to drill 1 well and re complete 5 wells. Forecast Initial production rates from all wells exceed 9000 BOPD and the FPSO is capable of handling the increased production rate, without much increase in the Operating costs. The capital cost for the POD is about $ 75 million.
The economics are very impressive as 65% of the gross production is allocated toward the cost recovery and BSL already has a carryover of $55 Million in cost recovery pool. In addition, the FPSO fixed and variable rates are attractive, as compared to rates before 2011, and would add substantially to the bottom line.
PT Arah Prana.
Arah Prana owns the FPSO facility, which is temporarily moored in North Sumatra waters and contracted to Pertamina and Blue Sky Langsa Ltd.
The FPSO is situated in East Aceh Offshore of Malacca Strait, one the of busiest channels in the world. FPSO is located on the North part of L Field and is connected by flexible production tubing to the three wells L1, L2 and H4. The Tubing and umbilical lengths are 1.0 KM from L1, 1.2 KM from L3 and 4.5 Km from H4. Three risers from the FPSO deck are connected to sub-sea trees for the respective wells. At the connection of L-3 and riser, MML set the PLEM to reduce the temperature. The FPSO contractor has hired a support boat and a standby boat is also available.
Max LOA = 220 meter equivalent to 80,000 DWT.
LOADING RATE: Min. 5,000 BOPH; Max. 10,000 BOPH.
SLOP TANKS CAPACITY: 12,500 BBL.
PRODUCTION FLUID HANDLING CAPACITY: 15,000 BPD.
CRUDE PROCESS CAPACITY: 15,000 BOPD.
PRODUCED WATER HANDLING CAPACITY: 10.500 BWPD.
PRODUCED GAS HANDLING CAPACITY: 12 MMSCFD.
Pakistan
Coastal Saba Power
Coastal Saba Power owns 100% of Saba Power Company, which operates a 138 M watts plant in Sheikhupura, Pakistan. The plant was built in 1996 with a total capital of $175 Million of which $50 Million was cash contribution by the shareholders and the remaining capital was raised by loans from major international Banks. As of 2011, 50% of the debt has been paid off. The company continues to operate, despite stringent conditions in the region.
Blue Sky Petroleum Pakistan Ltd.
This Company has about 2.8 million acres of exploration concession in Punjab area. Exploration activities continue with expected results in a few years, about its future drilling possibilities. The company is seeking farmout possibilities for this acreage.
USA
Tri Valley Gas Inc
Tri Valley owns the real estate and the gas stations in Colorado and New México, USA. While this operation has been with the Company for 15 years, the Company plans to divest from this arena.
Saga Energy Inc.
Saga Energy Inc. is a publicly listed company in USA. It focus is Service in the energy and power sector.