A regulatory notice on a drilling deadline has put the production sharing contract (PSC) for the gas asset under threat unless SundaGas Banda Unipessoal, a wholly-owned subsidiary of UK-based Sunda Energy listed on AIM, provides evidence that a rig has been booked to carry out an appraisal program next year off the coast of the Democratic Republic of Timor-Leste, Southeast Asia.
Two months after Sunda Announce Letter of Intent (LOI) With Finder to work together to secure a drilling rig for the pair’s offshore drilling campaigns off Timor-Leste, the AIM-quoted company revealed it had received notice from the country’s upstream regulator, Autoridade Nacional do Petróleo (ANP), to terminate the agreement. TL-SO-19-16 PSC, which the company operates in partnership with its government-owned joint venture partner, Timor Gap Chuditch Unipessoal.
This PSC contains Chodic gas fieldas SundaGas was preparing to drill Chodic-2 Rating well. The regulatory notice states that the operator is in breach of the terms of the supply contract because it failed to meet the minimum exploration work requirements for the third year of the supply contract, which covers the Chodice-2 drilling, by June 18, 2026.
As a result, the Company is permitted to make written representations to the ANP regarding the breach within 120 days of notice, until October 16, 2026, before the regulatory body makes a final decision on termination at its sole discretion.
The notice also states that NPC may consider granting an extension to meet the minimum exploration work requirements for the third year of the PSC contract, provided that SundaGas provides evidence of a signed binding contract for the rig to drill Chuditch-2 in 2027.
Commenting on this, the worker confirmed: “Sunda’s Board of Directors disagrees with the basis and background of the Notice and the Company is consulting its regulatory and legal advisors regarding the matters contained therein.
“SundaGas has also requested an urgent meeting with the ANP to seek clarification on the contents of the notice. The company reserves its rights in relation to these matters.”
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