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CBM Asia Provides Operational Updates on Indonesia Assets

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CBM Asia Development Corp. (CBM Asia or the Company) provided an operational update on its coalbed methane (CBM) properties in Indonesia.

ExxonMobil Joint Venture

CBM Asia and ExxonMobil have agreed to extend the Umbrella Agreement signed on Dec. 19, 2012. Both companies are engaged in amending certain terms of the agreement and the Company with approval from ExxonMobil will announce details in the near future.

“Our confidence in the commercial viability for CBM in Kalimantan is high and we look forward to success in the coming drilling season,” states Alan Charuk, president and CEO of CBM Asia Development Corp. “We expect to be able to release full details of the contract amendment in the near future.”

Sekayu PSC

On May 23, Medco Energi, the operator of Sekayu Production Sharing Contract (PSC), resumed production testing at the CBM-02 well, installing a new high-capacity submersible pump. The well is producing a steady 3,000 barrels per day of potable-quality formation water from the Miocene-age Palembang coal seams. Gas production was initiated almost immediately and is increasing as the well dewaters. Gas produced from the well is being consumed on site to drive the downhole pump.

Coring operations have been completed at the CBM-01 well. The Company is awaiting final gas content and coal analysis reports. 4.5 inch  casing has been run, cemented and perforated adjacent to the Palembang C coal seam at a depth of 1,380-1,404 feet.

“The rapid gas production to surface exhibited by the CBM-02 well confirms the high gas saturation previously measured on the Sekayu block and is consistent with results achieved by other CBM operators in the South Sumatra Basin”, noted CBM Asia’s Chairman Scott H. Stevens. “These well tests provide information needed to optimize the multi-well pilot design, which is expected to more effectively dewater the coal seams and achieve higher gas flow rates along with commercial production."

Kutai West PSC

Newton Energy, the operator of the Kutai West PSC, plans to begin completion and stimulation operations on four coal seams in the KW-CBM-01 well in September 2013. Dewatering at this location will follow pending the results of the stimulation program.

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