Oil and gas production company Jadestone Energy has agreed to purchase a 10% stake in the Lemang production sharing contract (PSC), onshore Indonesia.

With the latest transaction, the company’s stake in the Lemang PSC will reach to 100%.

Through a settlement and transfer agreement between Jadestone and PT Hexindo Gemilang Jaya, the 10% stake is being acquired in the Lemang PSC.

Jadestone will waive unpaid amounts associated to Hexindo’s stake in the Lemang PSC and pay an amount of $500,000 for the transfer of the stake by Hexindo.

The Lemang PSC consists of fully appraised Akatara gas field, which is expected to replace coal for locally produced gas in power generation.

Upon operational, the Akatara gas field is believed to expand Jadestone’s production base and increase the proportion of gas in the production mix.

Equating to a combined 18.7 mm boe of resource, the field is expected to include a 2C gross resource of 63.74bscf of natural gas, 2.45mmbbls of condensate and 5.64 mm boe of LPG.

Jadestone Energy president and CEO Paul Blakeley said: “The Lemang PSC is a key organic growth project for Jadestone and will provide meaningful gas production to the local market; displacing coal-fired power generation.

“We continue to make significant progress on commercial terms, with negotiations over a fully termed gas sales agreement at an advanced stage, and I would like to thank the buyer and the Indonesian government for their continued constructive engagement.

“A final investment decision is still expected in H1 2022 with first gas also still on track for H1 2024.”

The deal is subject to the approval of the Indonesian government, the shareholders of Hexindo and the shareholders of Hexindo’s parent company Eneco Energy.

Jadestone is an independent oil and gas company focused on the Asia-Pacific region. The company has exploration assets in Australia, Malaysia, Indonesia, Vietnam and the Philippines.

It owns a 100% stake in the Stag oilfield and the Montara projects, offshore Australia.