en.Wedoany.com Reported - Lion Energy has received formal approval from Indonesia's Ministry of Energy and Mineral Resources (MEMR) for its subsidiary Balam Energy to transfer a 15% participating interest in the East Seram Production Sharing Contract (PSC) to OPIC East Seram, marking the final regulatory clearance for the interest transfer transaction.
Upon completion of the interest transfer, Balam Energy will retain a 45% interest in the East Seram PSC, while OPIC's share will increase to 55%. Under the terms of the agreement, OPIC will provide 88% of the cost funding for the planned Bula Karang-1 (BK-01) exploration well, capped at US$5.6 million. Costs exceeding this cap will be shared between Balam Energy and OPIC in proportion to their respective interests. This financing arrangement enables Lion Energy to maintain a significant participation in potential exploration success while substantially reducing future capital obligations.
The East Seram PSC covers the Bula Karang prospect, with drilling planned for August 2026. Pre-drilling activities are currently underway, with the drilling team in place, major service contracts secured, and wellsite construction in progress. The BK-01 well targets a Pliocene-Pleistocene carbonate buildup offshore in Bula Bay, to be drilled as a deviated well from an onshore location, reducing costs compared to offshore operations. The prospect has a P50 potential resource of 12 million barrels of oil equivalent (mboe).
Lion Energy Chairman Tom Soulsby stated that receiving formal MEMR approval is a significant milestone for the East Seram project. The transaction has substantially improved the company's financial position ahead of the BK-01 exploration well drilling, while allowing the company to retain a 45% interest in a highly attractive exploration opportunity targeting a 12 million barrel oil equivalent field with access to existing production infrastructure. Since acquiring the East Seram PSC in 2018, Lion Energy has conducted multiple exploration activities, including a 664-kilometer offshore 2D seismic survey in 2020. Nearby oil infrastructure and adjacent existing fields provide favorable conditions for future commercialization. In April 2026, Lion Energy reached an agreement with Silver City Drilling to use the SCD-20 rig to drill the BK-01 exploration well.
