Gulf Indonesia Q1 exploration and development activities

Gulf Indonesia Resources, a 72 percent subsidiary of Gulf Canada Resources said on Monday that during the first quarter of 2002, production testing of the Suban-7 appraisal well in Corridor Block production sharing contract in South Sumatra was completed during the first quarter of 2002.

Evaluation of the test data is ongoing and gas reserves implications are yet to be determined, said the company. During January, Suban-7 flowed gas at a rate of 63 million standard cubic feet per day (MMCFD) through a 1 3/8 inch choke, confirming the presence of high deliverability gas reservoir in the northwest extent of the field.

The Suban-8 appraisal well, located in the south of the field, is scheduled to commence drilling during July 2002. This well, and possible additional Suban appraisal wells, will help determine the extent of Suban gas reserves potential, said Gulf. Reinterpretation of a 3D seismic survey recorded during 1999 commenced during the first quarter in order to incorporate data obtained from recent appraisal drilling.

Gulf also drilled three gas development wells in the South Jambi B block in Jambi during the quarter. These comprised two development wells at the Teluk Rendah gas field and one at the Geger Kalong gas field. These fields are targeted to supply gas from the South Jambi B block to the Sumatra Gas to Singapore contract, commencing in late 2003.

Meanwhile, In the Tungkal PSC in South Sumatra, Gulf said the testing of the Mengoepeh-7 appraisal well drilled during the fourth quarter of 2001 is scheduled in the second quarter. The results of this test will be used in the preparation of a Mengoepeh field development plan that the company expects to submit this year, said the company.

The SE Mengoepeh-1 gas discovery in the Tungkal block is scheduled to be tested during the second quarter of 2002. SE Mengoepeh-1 is located approximately 26 kilometres from the gas infrastructure currently planned for development in the neighboring South Jambi B PSC.

Also in South Sumatra Gulf conducted a 2D seismic survey over parts of the Corridor and Sakakemang blocks which commenced in March. This survey envisaged the acquisition of 657 km of seismic data -- 523 km in the newly acquired Sakakemang block and 134 km in the Corridor block -- over a period of approximately six months. The objective of the survey is to increase the inventory of gas prospects in the company's south Sumatra acreage with a view toward drilling some of these prospects during the 2003/04 timeframe, said Gulf.

During the first quarter, the company completed what it believes to be the largest offshore proprietary 3D seismic survey ever undertaken in Indonesia. The 2,523 square km survey covered most of the Ketapang block and a portion of the adjacent Pangkah block and was completed on schedule and on budget.

Guld said it expected to process the seismic data during the second and third quarter, with a view toward commencing a new drilling campaign during early 2003. A key objective of the seismic survey is to delineate the extent of the Bukit Tua / Jenggolo structure that was discovered during 2001 and which has oil and gas reserves potential.(alex)