How Conrad Asia Energy’s New Gas Deal Could Reshape Indonesian Energy Markets
Conrad Asia Energy has signed a significant gas sales agreement with Indonesia’s PLN subsidiary, underpinning the development of its Mako Gas Field and advancing exploration in Aceh. The company is progressing farm-down talks and preparing for a major seismic survey to unlock further gas resources.
- Binding Gas Sales Agreement signed with PT PLN Energi Primer Indonesia for Mako Gas Field
- Contract secures domestic gas sales of 392 TBtu through to 2037 with pricing linked to Indonesian Crude Price
- Ongoing farm-down negotiations for Duyung PSC to finance Mako development
- Upcoming 3D seismic survey planned for shallow-water Aceh PSCs to assess 546 Bcf prospective resources
- Cash position at US$2.83 million with strategic partnerships being pursued for Aceh assets
A Landmark Gas Sales Agreement
Conrad Asia Energy Ltd (ASX – CRD) has taken a pivotal step forward in its Indonesian natural gas ambitions by signing a binding Gas Sales Agreement (GSA) with PT PLN Energi Primer Indonesia, a wholly owned subsidiary of Indonesia’s largest power company, PLN. This agreement secures the sale of up to 392 trillion British thermal units (TBtu) of gas from the Mako Gas Field, located in the West Natuna Basin, through to January 2037. The contract allows for daily sales of up to 111 billion British thermal units, with pricing linked to the Indonesian Crude Price (ICP), aligning domestic gas prices with regional oil benchmarks.
Progressing Development and Financing
The GSA not only provides a stable revenue foundation but also enhances the financial viability of the Mako project. Conrad is actively engaged in farm-down discussions with a preferred partner to transfer some of its participating interest in the Duyung Production Sharing Contract (PSC), which encompasses the Mako field. These negotiations, aimed at securing financing and concluding agreements by the end of 2025, are critical to moving the project towards a Final Investment Decision and eventual production.
Expanding Exploration in Aceh
Beyond Mako, Conrad is advancing exploration in the Aceh region, holding 100% interests in the ONWA and OSWA PSCs. An internal assessment has identified unrisked P50 prospective resources of 546 billion cubic feet (Bcf) in shallow-water areas, supplementing previously reported deeper water resources exceeding 11 trillion cubic feet (Tcf). To better define these resources, Conrad plans to commence a circa 500 square kilometre 3D seismic survey in February 2026, focusing on areas with a strong track record of exploration success. This survey aims to de-risk prospects and support future development plans, including potential small-scale LNG and power generation projects.
Strategic Partnerships and Commercialisation
Conrad is also exploring strategic partnerships for its Aceh assets, engaging with potential equity partners for minority farm-ins. Additionally, the company has signed a memorandum of understanding with PT Perusahaan Gas Negara Tbk (PGN), Indonesia’s largest gas company, to collaborate on gas and LNG supply infrastructure. This cooperation could facilitate the commercialisation of Aceh’s gas resources through small-scale LNG projects, aligning with Indonesia’s growing domestic gas demand and energy transition goals.
Financial Position and Outlook
As of 30 September 2025, Conrad reported a cash balance of US$2.83 million. The company invested nearly US$1 million in the initial instalment for the upcoming seismic acquisition and continues to manage operational costs prudently. While the current cash reserves cover short-term expenditures, Conrad acknowledges the need for additional funding, which it expects to secure through farm-down transactions and potential debt facilities. The company remains confident in its ability to meet business objectives and advance its portfolio towards becoming a substantial gas producer in Southeast Asia.
Bottom Line?
With a major gas sales contract in hand and exploration poised to unlock further resources, Conrad Asia Energy is positioning itself for a transformative phase, pending successful farm-downs and financing.
Questions in the middle?
- Will Conrad finalize the farm-down agreements for the Duyung PSC by year-end as planned?
- How will the upcoming 3D seismic survey results impact the valuation and development timeline of the Aceh PSCs?
- What are the potential implications of the confidential GSA terms on Conrad’s future revenue and profitability?