Coro Energy enters Indonesian market with Lengo acquisition

Coro Energy has signed binding conditional agreements with AWE and HyOil for its first Indonesian acquisition.

The AIM-listed group will purchase of a 42.5% interest in the Lengo gas field's shallow water Bulu production sharing contract in East Java, marking its entry into Indonesia.

Coro will issue HyOil with as many as $4m worth of shares and will pay AWE roughly $8m in cash to cover the purchase price, cost reimbursement and other working capital adjustments.

Lengo was reported to contain independently certified gross 2C resources of 359bn cubic feet of recoverable dry gas and gross 3C resources of 420bn cubic feet, representing an additional upside.

Coro's chief executive James Menzies, said, "This first Indonesian acquisition provides Coro with a strong initial platform on which to progress our South East Asian growth strategy; it has been crucial for us to find the right asset on which to build, and being an asset with solid, proved gas resource base together with substantial technical and commercial upside, I believe this transaction delivers that."

As of 0940 BST, Coro shares had shot up 9.03% to 4.16p.