Sunda Energy (AIM:SNDA) announced that its wholly owned subsidiary SundaGas Banda has received a 12-month extension to the current phase of Production Sharing Contract TL-SO-19-16 from Timor-Leste's upstream regulator, Autoridade Nacional do Petróleo.
The AIM-quoted exploration and appraisal company, focused on gas assets across the Asia-Pacific region, had been facing possible termination of the licence after missing a drilling deadline for the Chuditch-2 appraisal well.
The regulator issued a notice of intention to terminate the PSC on 19 June, alleging the joint venture had breached minimum work requirements by failing to drill Chuditch-2 by 18 June, and gave SundaGas 120 days to submit written representations.
Since then, SundaGas and its government-owned joint venture partner, TIMOR GAP Chuditch Unipessoal, have held commercial discussions on a way forward, including a farm-in by TIMOR GAP for an enlarged working interest in the PSC and a transfer of operatorship to TIMOR GAP.
The extension gives the joint venture until the end of 2026 to complete those discussions, reach binding documentation and secure the necessary regulatory approvals, and comes with a suspension of the uplift on the PSC's cost recovery account from 19 June 2024 until drilling on Chuditch-2 begins.
"This extension is an important milestone as we progress towards the drilling of Chuditch-2," said Sunda chief executive Dr Andy Butler, adding that he was grateful to ANP for its support and to TIMOR GAP for the "positive spirit" of the discussions.
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Sunda also noted that Finder Energy Holdings, listed on the ASX, announced on 15 October a drilling rig contract for its Kuda Tasi and Jahal development in Timor-Leste, with additional optional slots that could accommodate other operators.
The company said it continues to liaise with Finder under the letter of intent signed in April, covering potential collaboration between the Kuda Tasi and Jahal and Chuditch-2 drilling campaigns.
