Australian-based oil and gas producer Cooper Energy Limited has secured a strategic interest in a high-value offshore block in North Sumatra, Indonesia including a number of discovered gas fields after acquiring unlisted Australian public company, Rion Energy, for 13 million Cooper Energy shares, escrowed for 12 months.

Rion Energy holds 22.5% of the Seruway Production Sharing Contract (PSC), offshore north-east Sumatra, which includes the undeveloped Gurame Gas Field, with estimated recoverable reserves in the range 400 ‑2,700 Bcf plus 20-150 million barrels of condensate. This field was discovered and delineated between 1967-1972 when there was no regional market for gas, and is strategically located 50km from the major Arun LNG plant.

The acquisition will represent a significant addition to Cooper's international oil and gas portfolio and will result in a second major impact well being drilled in Indonesia after Kurnia-1 (Cooper Energy share 30%) on South Madura.

In addition to the Gurame Gas Field, the Serway PSC also contains a number of other discovered but undeveloped gas fields, several mature prospects and a further 35 leads and prospects, which will require new seismic to mature for drilling. These other leads and prospects are estimated to have a total recoverable reserve potential of greater than 10 Tcf of gas and 500 million barrels of condensate.

Cooper Energy chief executive Michael Scott says that the Rion Energy acquisition represents an exceptional quality addition to its Indonesian portfolio and has the potential to provide Cooper Energy with a major development project in the very near future.

"What really impressed us is the quality of the technical data set over existing gas discoveries and the large number of leads and prospects within the block," Michael Scott says.

Assets of this quality are extremely difficult to obtain for small E&P companies in an industry that is generally considered to be opportunity constrained at present. In addition to the gas discoveries, there is also the potential for oil.