Medco spuds 2nd Sumatra CBM well

Vancouver-based firm CBM Asia Development Corp. announced Tuesday that its partner PT Medco CBM Sekayu which operates Sekayu CBM PSC in South Sumatra has spudded the third exploration well on October 29th, 2010.

CBM-SE-03 will be a vertical well with a 3,300-foot planned total depth, aimed at evaluating gas potential and reservoir properties of the two main coal groups of the Middle Palembang Formation - the upper Palembang Group and lower Pangadang Group, the company said.

Under the terms of the Sekayu PSC, the minimum work commitment requires a total of four wells to be drilled in the first three years.

Initial test results from these operations are not expected to be available until later in the fourth quarter of 2010.

CBM Asia Development Corp. is a Canadian-based unconventional gas company with significant CBM exploration and development opportunities in Indonesia. The company has the right to earn an estimated 12% participating interest in Sekayu CBM PSC, where initial exploration drilling of a production test well commenced in the second half of 2009. (alex)