Arrow seals E. Kalimantan CBM exploration deal

Australian CBM producer Arrow Energy announced on Monday that it and Ephindo Ilthabi CBM Holding Inc. (Ephindo), a subsidiary of Ephindo group of companies, have executed final agreements to jointly operate a CBM Production Contract together with Pertamina Hulu Energi Metana, a subsidiary of state oil and gas company PT Pertamina, on the Sangatta West Block, in East Kalimantan.

Arrow and Ephindo will now commence finalization of the work program and budget with a view to starting exploration drilling in the second half of 2009, it said.

?Arrow and Ephindo may also extend this partnership into other related areas of interest based on the successful development of this relationship,? it said.

The working area of Sangatta West is approximately 1,300 sq. km.

Arrow CEO Nick Davies stated that ?with the signing of these agreements between Arrow and Ephindo, both parties are now geared up to begin Indonesia?s first successful CBM drilling and production program. We certainly think that this marks another milestone in Arrow?s ambitions to build a dominant CBM position in Indonesia.?

The company also announced last week the signing of HoA with IDX-listed energy firm PT.Medco Energi Internasional TBk to jointly jointly explore for and develop coal bed methane over Medco?s 1,889 square kilometer conventional oil and gas PSC working area, the SSE1 Block in South Sumatra.(denny)