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WAIN BLOCK KUTAI BASIN

EAST KALIMANTAN

PT. PANDAWA PRIMA LESTARI

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Executive Summary of Wain Block September 2016 Page 1

INTRODUCTION

Wain Block is located in East Kalimantan that covers 3 regencies:

Balikpapan, Penajam Paser Utara and Kutai Kertanegara. Presently, the

working area of Wain Block is 746.78 sq. Km. Firm Commitments

(seismic, reprocessing, study, and drilling two exploratory wells) have

been completed after drilling the discovery Karamba Updip-1 well early

this year.

Results of the KUD-1 well is far exceeded our expectation; the well

encountered seven (7) reservoir sands with very good gas shows (up to

C5) during drilling; we tested 5 intervals, 3 of them flowed at a total rate

of 20 mmcfg/d using 2 7/8" tubing; if we use 3 1/2" tubing for production,

the rate could easily reach 50 mmcfg/d, with no water.

Total Net Gas Pay was expected to be 60 feet, and the well

encountered 172 feet Net Gas Pay. The P1 Recoverable Reserves

based on 3 DSTs (72 hours each) indicated 120 bcf. The original

calculations of the Recoverable Resources on the KUD structure was

129 bcf; and after drilling the KUD-1 well, the RR of the structure now is

calculated to be more than 300 bcf.

Total Recoverable Resources of the 10 existing prospects is now

1.5 TCF (previously 1.24 TCF). Development of the ten prospective

structural closures that have 1,5 TCF recoverable reserves for gas will

generate (assuming gas price @ USD 5.0/mscfg): a Net Cash Flow of

MUSD 1,507, NPV of MUSD 247 at discount rate of 10%, the Project

POT of 0.9 years after development of the fields, and IRR of 34.8 %.

Executive Summary of Wain Block September 2016 Page 2

In geological view, Wain Block is located on Kutai Basin. Kutai

basin is one of the most productive hydrocarbon basins in Indonesia

(see Fig. 1). Based on the Geological Risk Evaluation to all prospects in

Kutai Basin give the ratio of between 0.20 – 0.32 which can be classified

as low to moderate risk. Moreover, Wailawi gas field, discovered in 1975

by Vico, and has been producing gas, is located adjacent to the Wain

Block and has the same stratigraphic and structural regime.

Executive Summary of Wain Block September 2016 Page 3

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SUMMARY OF WAIN PSC

Location : Located onshore, eastern of Kalimantan island and part of Kutai Basin. This Block located in 3 regencies ; Balikpapan, Penajam Paser Utara and Kutai.

Contract Area : 1,149.30 sq. Km.

Type of Contract : Production Sharing Contract with the following equity split:

For Oil:Government entitled to take and receive eighty percent (80%) after tax and Contractor entitled to take and receive twenty percent (20%) after tax,

For Gas: Government entitled to take and receive seventy percent (70%) after tax and Contractor entitled to take and receive thirty percent (30%) after tax.

Term of Contract : Thirty (30) years from effective date (January 16, 2007).

FTP : Ten percent (10%).

DMO : DMO = Twenty five percent (25%) x Contractor share. DMO = Twenty five percent (25%) x Oil Price.

Government Tax : Forty four percent (44%).

Maximum Cost Recovery

: Ninety percent (90%) of gross revenue.

Relinquishment : Twenty percent (20%) in third year. Retain Twenty percent (20%) in sixth year, or as large as the producing fields.

Executive Summary of Wain Block September 2016 Page 6

AVAILABLE SUPPORTING DATA & POTENTIAL OF WAIN BLOCK

Geological Data Provided

:

Six (6) packagess of well data (Loa Haur 1, Saka Kanan 1, Mentawir 1, Semoi 1, Penajam – 1 and Rico – 1). New exploration well, South Karamba-1, drilled in 2009.

Geophysical Data Provided

: 2D seismic data with total of length more and less 1,337 kms with different interval shot points; 30, 60 and 120 m multi-vintages (from year 1970, 1980 & 1990’s). New seismic acquisition in 2009 – 2D (100 km) & 3D (20 km2).

Source Rock / Reservoir

: Main target: Sandstones, Pulau Balang formation.

Second target: Sandstones, Balikpapan formation.

Third target: Carbonates, Bebulu formation.

Estimated Total Target Depth

: Between one thousand (1,000) to two thousand (2,000) m. under sea level.

Identified of Prospect & Lead

: Based on seismic mapping, eleven Leads and ten drillable prospects have been identified in the Wain Block.

Potential Hydrocarbon

: Reserve hydrocarbon calculation in the Wain Block (For 100% filled with oil and gas respectively) shows the OOIP (Original Oil in Place) is 3,725 MMBO for unrisked oil case (P50) and 745 MMBO for recovered oil case (P50), while the OGIP (Original Gas in Place) is 3,820 BSCF for unrisked gas case (P50) and 3,247 BSCF for recovered gas case (P50).

Executive Summary of Wain Block September 2016 Page 7

EXPLORATION COMMITMENT

All firmed commitments have been completed after 1st quarter this year :

o 2D and 3D Seismic Acquisition o Surface Mapping o Geochemical Survey o Resistivity Survey o South Karamba-1 well - suspended o Karamba Updip-1 well - discovery

The first 10 years of the 30 years PSC contract is dedicated as exploration phase.

PROGRAM & BUDGET

The estimated budget for drilling two (2) exploratory well is about fifteen million US dollars (US $ 15,000,000). Also for General Administration is about one and half million US dollars (US $ 1,500,000) and for Exploration Administration is about five hundred thousand US dollars (US $ 500,000)

Executive Summary of Wain Block September 2016 Page 8

PRESENT OWNERSHIP PT. Pandawa Prima Lestari hold 100% of Participating Interest.

INVESTMENT OPPORTUNITY PT. Pandawa Prima Lestari plan to farm out 35% of its Participating Interest in Production Sharing Contract of Wain Block.