CBM Asia updates Sekayu CBM project

Vancouver-based firm CBM Asia Development Corp. reported on Wednesday that its partner PT Medco CBM Sekayu, which operates Sekayu CBM block in South Sumatra has successfully drilled the upper portion and set 7-inch casing in all three new CBM test wells (CBM-SE-01, -03, and -04).

At present Medco is in the process of procuring the services of a wireline-coring tool that will sample the coal section of the three wells for gas content and permeability testing, planned for February 2011. Core Laboratories N.V. has been contracted to conduct the gas content sampling and analysis on site, Weatherford International Ltd. has been contracted to perform the Coreless Critical Desorption Pressure testing, while the permeability testing will be conducted by Medco.

Production testing (dewatering) on the previously drilled CBM SE-02 will be scheduled in February 2011.

Once the new CBM reservoir data becomes available, most likely during the second quarter of 2011, the Company plans to engage the services of a Qualified Reserves Evaluator to audit the CBM resources at the block, based on National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities. The reservoir data and the dewatering well will also help guide the design of the CBM production pilot which, contingent upon positive results, is planned for second half of 2011.

CBM Asia has the right to earn an estimated 12% participating interest in Sekayu CBM PSC. (alex)