Range Resources has signed an agreement to acquire interests in the Perlak field in Indonesia from PT Hengtai Weiye Oil and Gas.
Located in the province of Aceh, North-east Sumatran basin and spread over an area of 10.4km², the field has a licence period of 15 years through to 2032.
Under the agreement, Range will acquire an initial interest of 23% for $3.2m.
Once a minimum work programme is completed, the company will increase its interest in the field to 42%.
Range Resources chairman Kerry Gu said: "The low acquisition cost, minimal work programme commitment and protection from underperformance present a very attractive opportunity for the company to expand its footprint and potentially grow its reserves base.
“We look forward to the commencement of the work programme and unlocking the full potential of this highly prospective asset, which should deliver significant benefits to our shareholders in the form of increased production, reserves, and new development opportunities.”
It is estimated that the field has material remaining oil in place of up to 500mmbbls.
The three-year work programme, which is expected to cost $2.28m to Range, is directed at resuming production from the existing wells, strengthening the field development plan (FDP), as well as exploiting the potential resources.
The agreement will also provide Range Resources’ Hong Kong-based subsidiary a 60% stake in Hengtai.
The acquisition is based on the realisation of certain milestones such as producing a minimum of 800 barrels of oil per day from the Perlak field over a 90-day period, in addition to identifying 1P reserves of at least 10mmbbl within a three-year period.
Closure of the deal is subject to approval from the Indonesian Investment Coordinating Board (BKPM), and completion of statutory notification requirements.