Cue Energy reports first gas from Oyong field

(2 October 2009)--Cue Energy Resources Limited is pleased to announce that first gas production has begun from the Oyong Oil and Gas Field located in the Sampang Production Sharing Contract (?Sampang PSC?) in the Straits of Madura, offshore East Java, Indonesia, today.

The gas is being transported, via a 14? 60km pipeline, from the offshore Oyong production facility to the onshore processing plant at Grati, East Java. Liquid rich components are removed from the gas onshore and the gas is then metered and supplied to PT Indonesia Power for electricity generation under an existing gas supply contract for the whole of the gas from the field.

The Oyong Field is a simple structural closure with oil and gas contained in the Pliocene aged carbonate Mundu Formation.The field contains approximately 103BCF (P50) of recoverable gas (95% methane). A plateau gas production rate of approximately 6OBBtu per day is estimated. This target rate is expected to be reached during October 2009. Oil production will continue alongside gas production.

Cue?s Chief Executive Officer, Bob Coppin states that, ?this first gas production for the company represents yet another significant milestone for Cue and adds to our existing oil producing assets in Papua New Guinea Indonesia and New Zealand.

Australia's Santos is the operator of Sampang PSC with 45 percent interest, while Cue Energy and Singapore Petroleum Company have 15 and 40 percent interest, respectively. (end of release)