Sunda Energy PLC (AIM:SNDA) has taken a big step towards drilling its Chuditch-2 appraisal well in the waters off Timor-Leste after securing a key farm-in deal and fresh backing from institutional investors.
The AIM-listed company said its subsidiary SundaGas has signed a binding agreement with state-owned TIMOR GAP to reshape ownership of the Chuditch project.
Under the new terms, TIMOR GAP will boost its stake from 40% to 70%, significantly reducing Sunda’s share of drilling costs from 80% down to 30%. That’s a major financial break for a small-cap explorer.
To help fund its share of the upcoming drilling campaign, Sunda has raised up to $9 million through the issue of unsecured convertible loan notes to three institutions, with Marex Financial brokering the deal.
This provides the firepower needed to finalise a contract for a jack-up rig, with drilling expected to kick off in the third quarter of 2025.
CEO, Dr Andy Butler, said: "I am delighted to announce that funding has been confirmed for the drilling of the critical Chuditch-2 well. This funding paves the way to unlocking the value of the Chuditch gas field.
"We expect to sign a rig contract shortly and within a few months we expect to be drilling one of the most eagerly awaited and impactful wells in the Asia-Pacific region. We are grateful for our deepening collaborative relationship with TIMOR GAP.
"Their decision to further invest in Chuditch highlights not only the Project's materiality, but also its strategic national importance to Timor-Leste.
"Our aligned vision for the accelerated early development of the Chuditch gas field means TIMOR GAP remains the ideal joint venture partner as we enter the drilling phase."
The Chuditch field, part of the TL-SO-19-16 Production Sharing Contract, is viewed as one of Southeast Asia’s promising untapped gas prospects. Sunda will remain operator of the licence.