Indonesia Energy Corp to Commence Drilling Operations at Kruh Block by End of Year

Indonesia Energy Corporation (NYSE American: INDO) ("IEC"), an oil and gas exploration and production company based in Indonesia, provided an operational update on July 16, 2024. IEC announced the completion of recording 29 square kilometers of new 3D seismic data at its 63,000-acre Kruh Block. The company will commence processing and conducting detailed interpretation of the seismic data to enhance the selection of drilling sites in its Kruh, North Kruh, and West Kruh fields. IEC anticipates that the results of this seismic work may enable the drilling of new production wells at Kruh Block by the end of 2024.

Furthermore, IEC stated its intention to initiate operations by year-end at its 650,000-acre Citarum Block, where reserves could potentially surpass a billion barrels of oil equivalent. Serving as the operator of the Kruh Block, IEC is strategically concentrating its 3-D seismic program on established proved reservoirs within the Talangakar and Lemat formations, along with expansive shallow oil and gas zones, notably including the K-28 well discovered by IEC in 2022.

The newly acquired high-quality three-dimensional seismic data will aid in identifying additional proven undeveloped reserves and resources. This will allow IEC to prioritize the sequence of upcoming drilling locations as it resumes drilling operations at the Kruh Block. Preparations for the new drilling campaign are already underway, with the first well planned for drilling in the fourth quarter of 2024 following the completion of the evaluation of the new three-dimensional seismic data.

In September 2023, IEC announced the extension of its joint operation contract with Pertamina, the Indonesian state-owned oil and gas company, for the Kruh Block. The extension adds 5 years to the contract, now running from May 2030 to September 2035. The Kruh Block covers approximately 63,000 acres and is located onshore on the Island of South Sumatra, Indonesia.

The revised joint operation contract includes the following significant provisions:

•  It raises IEC's after-tax profit share from the current 15% to 35%, marking an increase of more than 100%.

•  With the contract extended by 5 years, it is anticipated that IEC's proved reserves at the Kruh Block will increase by over 40%.

• Moreover, due to the enhanced profit split, IEC's projected net cash flow from its Kruh Block development plan is expected to surge by over 200% compared to what was anticipated under the previous contract.

In the Citarum Block, IEC has recently obtained government environmental permits, enabling the swift commencement of seismic operations. The company plans to begin drilling next year. As previously disclosed, IEC estimates that the Citarum Block holds prospective oil-equivalent resources exceeding one billion barrels of oil.

Mr. Frank Ingriselli, President of IEC, expressed enthusiasm about completing the acquisition and initiating interpretation of new seismic data at our Kruh Block. This development positions our company favorably as we prepare to resume drilling activities at Kruh Block by late 2024. He highlighted Kruh Block as a world-class asset, emphasizing the substantial economic benefits derived from the 2023 contract extension with the Indonesian government. Mr. Ingriselli emphasized leveraging insights from past discoveries, including a significant gas find in 2022, to optimize future drilling locations.

Furthermore, Mr. Ingriselli noted progress at our 650,000-acre Citarum Block, where previous operators discovered several significant gas reserves. He underscored IEC's optimism about its potential, aiming to enhance shareholder value through ongoing efforts.