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akarta-listed oil and gas company PT Medco Energi Internasional said it had swapped its stakes in the Bangkanai production sharing contract (PSC) for stakes in two other productive fields.

The company announced on Monday that it had, through its subsidiaries, entered into swap agreements with companies under London-listed Salamander Energy plc. Under the agreements, Medco exchanged its 15 percent participating interest in the Bangkanai PSC for Salamander’s 21 percent participating interest in the Simenggaris PSC and 41.7 percent in the Bengara-1 PSC in Kalimantan.

Following the completion of the agreements, which are subject to approval from the government, Medco’s ownership in Simenggaris rose to 62.5 percent. Moreover, it now fully owns Bengara-1.

“Completing this swap transaction is an important milestone for Medco Energi to support the supply of gas for the domestic market as well as to add to the company’s reserves,” Medco president director Lukman Mahfoedz said in a written statement.

After the agreements are approved, Medco will see its booked reserves in Simenggaris increase by 5 million barrel oil equivalent (boe) to 15 million boe.

Semanggaris completed its production facility development last year and signed a gas sales and purchase agreement with local company Perusahaan Daerah Nusa Serambi Persada (Perusda NSP) in which it will supply 5 million standard cubic feet per day (mmscfd) of gas to the local firm for a period of 11 years from 2013 through 2024.

Medco said it was negotiating with other gas buyers to supply 25 mmscfd of gas for another 11-year contract. It also is planning to drill one exploration well this year.

Meanwhile, Bengara-1 block is planning to supply gas for PLN to fuel a 10 MW power plant located in Nunukan Regency, East Kalimantan.

“Simenggaris [...] is ready to supply gas to the domestic market. Bangkanai remains at the exploration and development stage. Therefore, the risk profile is different and so too is the investment cost,” Medco corporate secretary Imron Gozali said, commenting on why the company divested Bangkanai.

Bangkanai is located onshore in central Kalimantan and has a gas field called Kerendan. According to a statement from Salamander, Kerendan is already committed to sell 122.6 billion cubic feet (bcf) to Indonesia’s electricity firm PT PLN. The gas field also has the potential of more gas with as many as 160 bcf of contingent resource identified in the field, according to Salamander.

Prior to a deal with Medco, Salamander has acquired Bangkani’s 11 percent stake, from Elnusa Chariot International Limited. Salamander, the Bangkanai operator, acquired Elnusa’s stake in a deal worth US$6 million.

The transactions might have made Salamander the sole owner of Bangkanai but the company said that it wouldn’t work on the field on its own.

Salamander said it would farm-out a 30 percent interest in Bangkanai to PT Saka Energi Indonesia. Salamander said that the 30 percent interest would be exchanged for $27 million cash to finance the development of the Kerendan field and wells exploration activities amounting to $30 million.

“We are very pleased to announce two transactions today that will see us consolidate the remaining minority interest in Bangkanai PSC and welcome a strategic partner into one of our core areas. Although a new entrant to the upstream E&P sector, Saka brings expertise of the transportation and distribution of gas in the region,” Salamander chief executive officer James Menzies said in a written statement.