Medco penetrates thick coal at Sekayu CBM PSC

CBM Asia Development Corp. announced Tuesday that operator PT Medco Energi Internasional Tbk penetrated over 230 feet of net coal in its most recent exploration well at the Sekayu CBM PSC in South Sumatra.

Actual coal thickness exceeded the pre-drill prognosis by 50% with all coal seams exhibited strong gas shows.

Preliminary gas contents from the CBM-SE-03 well correlate with equivalent coal zones in the two previous Medco Energi test wells, based on well-site desorption underway by contractor Core Laboratories N.V, the company said.

Medco Energi has now drilled three test wells across the Sekayu block, indicating that thick coal seams with favorable gas content underlie a significant portion of its 583-km2 total area. Core Lab's final analysis of core from these wells is anticipated by late June. Dallas-based Netherland, Sewell & Associates, Inc., the Company's newly appointed Qualified Reserves Evaluator, has initiated its audit of the Company's coalbed methane resources in the property under Canadian Standards of Disclosure for Oil and Gas Activities. NSAI's report is expected to be completed by July.

Medco Energi has 50 percent interest in the block with CBM Asia has the right to earn an estimated 12% participating interest. (alex)