Government and TIMOR GAP sign Memorandum of Understanding concerning potential development of Chuditch PSC gas resources
The Government, represented by the Ministry of Petroleum and Mineral Resources, signed a Memorandum of Understanding on 12 December 2024 with the public company TIMOR GAP, E.P. (parent to TIMOR GAP Chuditch Unipessoal Lda - Joint Venture (JV) partner in the TL-SO-19-16 Production Sharing Contract (the “Chuditch PSC”) and SundaGas Banda Unipessoal, Lda (wholly owned subsidiary of Sunda Energy Plc), the Operator of the Chuditch PSC. The MOU sets out the framework for joint evaluation of a development concept for gas resources on the Chuditch PSC, including pipeline export to the Bayu-Undan field and on to planned LNG facilities on the south coast of Timor-Leste. 
Through the MOU, SundaGas and its JV partner, TIMOR GAP Chuditch Unipessoal, Lda have agreed to work closely with MPRM and ANP (Timor-Leste's National Petroleum Authority) to plan an accelerated development of Chuditch gas following drilling of the Chuditch-2 appraisal well scheduled for Q2 2025. In anticipation of a successful production flow test (“DST”) at Chuditch-2, the parties to the MOU are collectively undertaking engineering and commercial studies to evaluate the feasibility (the “Feasibility Study”) of developing Chuditch gas, with pipeline export to existing facilities at the Bayu-Undan gas field and onward transmission to an LNG facility to be located on the south coast of Timor-Leste (expected to be in the Natarbora district). These studies have already commenced.
Based on the development concept described above, and subject to a successful DST at the Chuditch-2 appraisal well, SundaGas, the Operator of the Chuditch PSC, would commit to deliver gas to Timor-Leste via Bayu-Undan facilities at an agreed plateau production rate and duration, and MPMR and/or its affiliates would commit to expedite development of receiving and onward transmission facilities for gas at Bayu-Undan and onshore, including the installation of a gas export pipeline from Bayu-Undan to the south coast of Timor-Leste. MPMR and/or its affiliates would commit to buy the gas from Chuditch field, to assist in the financing of the Chuditch field development. The above commitments are non-binding and subject to successful appraisal drilling and DST, and the conclusion of future binding documentation between the parties to the MOU. 
SundaGas is 60% licence holder and operator of the Chuditch PSC, in partnership with TIMOR GAP Chuditch Unipessoal Lda (40%), a wholly owned subsidiary of TIMOR GAP E.P. The PSC contains the Chuditch gas field, discovered by Shell with the Chuditch-1 well in 1998. Following completion by SundaGas of extensive 3D seismic reprocessing and associated technical studies, the Company announced on 27 February 2023 the publication of a Competent Person’s Report which concluded that the Chuditch PSC holds Pmean Contingent Gas Resources of 1.16 Tcf in the Chuditch field and a further 1.65 Tcf of low-risk Pmean Prospective Gas Resources in adjacent exploration prospects. The Chuditch joint venture plans to drill an appraisal well (Chuditch-2) in Q2 2025, at a location more than 5 km from the Chuditch-1 discovery well and where it predicts a vertical gas column of around 150m. A key objective of the drilling is to conduct a DST to demonstrate commercial viability of the field. Preparations for the drilling of the Chuditch-2 well are ongoing.
