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AKARTA: Publicly listed oil and gas explorer PT Sugih Energy (SUGI) will soon begin drilling work at the company's Akatara-2 exploration well in Lemang block, Jambi with total cost up to US$7 million.

SUGI president director Andhika Anindyaguna said that the company would prepare for the drilling right after it had finished the drilling work at the company's Akatara-1 exploration well.

'We [the company] will start the drilling within the next few days,' he added.

From the Akatara-1 exploration well, SUGI found a potential gas production of up to 11 million metric standard cubic feet per day (mmscfd) with condensate of 380 barrels per day.

SUGI said although the Akatara-1 well had indicated potential gas reserves, the company would need to wait for the results of the exploration of the Akatara-2 well before beginning commercial production.

 'We expect that Lemang block could start producing [oil and gas] this year,' Andhika said.

SUGI has no operating oil and gas blocs to date. The Lemang block is estimated to hold 511 million barrels of oil and 468 billion cubic feet (bcf) of gas.

Eastwin Global Investment Ltd., a subsidiary of SUGI owns a 49 percent participating interest in the Lemang block, with the other 51 percent held by PT Hexindo Gemilang Jaya.