Sunda Energy plc has been accused of breaching the terms of the Timor-Leste production sharing contract by failing to drill on schedule an appraisal well on the Chuditch field.
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The company’s subsidiary, SundaGas Banda Unipessoal, Lda, yesterday received a letter of notification from the country’s upstream regulator Autoridade Nacional do Petróleo (ANP).
Sunda said it would seek legal advice over the potential termination.
SundaGas has been preparing to drill the Chuditch-2 well since early 2025.
The company operates the PSC TL-SO-19-16 with government-owned joint venture partner Timor Gap Chuditch Unipessoal, Lda.
Sunda added: “The notice states that SundaGas is in breach of the PSC in that it has failed to fulfil its minimum exploration work requirements for contract year 3 of the PSC, namely, to drill Chuditch-2 by 18 June 2026.”
SundaGas has until 16 October to submit written representations regarding the breach to ANP, before the latter makes its final decision.
Sunda said that ANP could grant SundaGas more time to fulfill the minimum exploration work for contract year 3 of the PSC, subject to SundaGas presenting a binding signed contract for a rig to drill Chuditch-2 during 2027.
“The board of directors of Sunda disputes the basis of, and background to, the notice and the company is consulting with its regulatory and legal advisers with respect to the matters therein,” added Sunda.
“SundaGas has also requested an urgent meeting with ANP for clarifications regarding the contents of the notice.
“The company reserves its rights with respect to these matters.”
The well will targeting a predicted 149-metre gas column, which is far larger than the 30m gas column at Chuditch-1.
Sunda holds a 60% working interest in the PSC, which has a total resource potential of 3.3 trillion cubic feet.