This is due to its initial assessment of the South Furious Merah exploration well, which remains commercially unviable with insufficient hydrocarbon volumes.
The South Furious Merah exploration well is part of Hibiscus Petroleum’s drilling programme conducted by its subsidiary, SEA Hibiscus Sdn Bhd.
The reason for the write-off is based on the initial assessment which found that the hydrocarbon volumes seen in the well may not meet commercially viable economic thresholds. SEA Hibiscus is expected to drill three exploration wells, including the South Furious Ungu and South Furious Ungu ST wells, to evaluate prospective Near Field exploration locations within the boundaries of the 2011 North Sabah Enhanced Oil Recovery Production Sharing Contract.
Hibiscus Petroleum added that the capital costs, net of tax to SEA Hibiscus, estimated for the Ungu wells are expected to be in the range of RM54 million.