Salamander Appraises Tutung Discovery with Success

Salamander Energy plc, an independent upstream oil and gas exploration and production company focused on South East Asia, announced the successful appraisal of the Tutung gas-condensate discovery in its operated Bontang PSC, East Kalimantan, Indonesia.

The Tutung Alpha-1 well was drilled to a total depth of 3,250 metres sub-sea and the found multiple gas and condensate bearing sandstones between 2,990 metres and 3,120 metres subsea in the target Middle Miocene Pulubalang Formation. A full suite of logs have been run and a comprehensive programme of both pressure testing and gas and fluid sampling has been carried out.

An initial analysis of the acquired data indicates the presence of good quality, multiple stacked channel sandstone reservoirs with a net pay thickness of at least 16 metres and a potential column height in excess of 60 metres. The original discovery well, Tutung-1, flow tested at 10 million standard cubic feet of gas and 613 barrels of condensate per day from a single channel sand.

The well has been suspended as a future producer. Salamander has an option to return and further appraise the Tutung discovery using the Ensco-1 barge mounted rig once it has completed the appraisal drilling on the Gurame discovery in the Seruway PSC, in which Salamander will have a 22.5% interest on completion of its proposed acquisition of GFI Oil and Gas.

James Menzies, Chief Executive of Salamander, commented, "The positive results from Tutung Alpha-1 indicate the potential for a commercially viable development. We will return to further appraise and test the Tutung gas-condensate feature in order to confirm the volume of resources in place. We are also looking forward to exploring the multiple prospects in the offshore area of the PSC over which we have recently acquired 3D seismic.

This result, in tandem with recent successes at South Sembakung and Dong Mun, provides an early indication of the value creation opportunities to be found within Salamander's active, high impact drilling programme in 2008."