Australia's AWE Sells Stake in Indonesian Undeveloped Gas Asset

Australia listed AWE Limited on Thursday announced that it has agreed to sell its stake in Bulu PSC in Indonesia to Singapore incorporated HyOil Pte Ltd for A$27.5 million.

The Bulu PSC is located offshore east Java and includes the undeveloped Lengo gas project. AWE has 42.5 percent stake in the PSC.

The decision is part of AWE’s strategy of divesting non-core assets in order to recycle capital into high value growth projects, such as the Waitsia gas project in Western Australia.

“The sale of the Bulu PSC, including the undeveloped Lengo gas project, is another important step in reshaping AWE to deliver sustainable growth in a low oil price environment,” David Biggs, AWE’s Managing Director and CEO, said.

“In the current low-oil price environment, we are focused on achieving near-term growth through the delivery of valuable domestic gas projects. We have commenced construction of Stage 1A of the Waitsia gas project, an A$18 million (gross) development that will supply gas to the historically strong Western Australia domestic gas market from the third quarter of this calendar year. The Waitsia joint venture is already considering options for the next phases of development to deliver up to 100 TJ/day, and gas marketing is well under way,” Biggs said.

Briggs added that over the next 12 to 24 months AWE will be recontracting gas from its east coast production assets in the Bass and Otway basins.