Cue Energy: Mahakam Hilir PSC operations update

(December 20, 2013)--Cue Energy Resources Ltd (Cue) advises that at 08:00 local time on 20 December 2013, the Naga Utara-2 ST well is at a depth of 5,520 ft MDKB (1,676m).

Since the last report, a window has been milled in the 9⅝? casing and the well has been successfully sidetracked around the obstruction left in the original hole. The well is currently drilling ahead in 8?? hole towards a revised total depth of 6,818 ft MDKB (2,078m).

The well site is located in the onshore portion of the Kutei Basin on the island of Kalimantan (Borneo), approximately 10 km NE of the town of Samarinda (map attached). Naga Utara-2 is operated by SPC Mahakam Hilir Pte Ltd, a subsidiary of Singapore Petroleum Company Ltd.

The well is the third to be drilled by the Mahakam Hilir Joint Venture and will appraise the gas shows seen in Miocene-age sandstones at Naga Utara-1 which were not fully evaluated in the previous well due to mechanical problems. The well will then be deepened to evaluate additional reservoir objectives. The well is being drilled from the same pad as Naga Utara-1 to a target location approximately 475m north of the earlier well.

Cue will provide progress reports during the drilling of Naga Utara-2; the next progress report will be issued on 3 January 2014. Participating interests in the Mahakam Hilir PSC are as follows:
Cue Mahakam Hilir Pty Ltd 40%
SPC Mahakam Hilir Pte Ltd 60% (Operator) (ends)