Salamander Begins Drilling at East Kalimantan

Salamander announced the spud of the South Sebuku-2 ("SS-2") appraisal well, Bengara-1 PSC, East Kalimantan. The South Sebuku gas discovery was made in 2009 and is thought to contain gross mean contingent resources of circa 80 Bcf. Salamander has a 41% interest in the Bengara-1 PSC.

SS-2 will target gas-bearing sandstones in the Tabul, Meliat and Naintupo formations and be drilled to approximately 1,370 metres total vertical depth sub-sea. It will be drilled using the HPS-1 land rig and is expected to take approximately 30 days to complete on a dry hole basis.

In the event of appraisal success, the Bengara-I partners will look to tie the South Sebuku discovery into the South Sembakung gas field, located within the neighboring Simengarris PSC. The South Sembakung development is currently on-going with a view to coming on-stream in 4Q 2012, in order to supply the Bunyu Island Methanol plant with 25 MMscfd.

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