Pan Orient strikes gas in Sumatra

Calgary-based oil, gas firm Pan Orient Energy Corp. announced Tuesday that that Tuba Obi Utara-1 (NTO-1) exploration well, the first of three back to back high impact exploration wells located in the Batu Gajah PSC onshore Sumatra has encountered approximately 10.5 feet of gas pay within a good quality sand at a depth of 3,991 feet.

The company also decided to sidetrack NTO-1 well with NTO-1 ST to determine if a down dip oil leg is present at the location.

NTO-1ST is currently drilling ahead at 2,704 feet true vertical depth towards a subsurface Lower Talang Akar formation target approximately 780 meters northeast of the original Lower Talang Akar formation reservoir penetration and 113 feet structurally lower than encountered at NTO-1. Drilling is anticipated to be completed within the next ten days with testing likely only in the event that an oil leg is present.

A substantial portion of interpreted reservoir volume exists up dip of the NTO-1 well and will likely be evaluated with an additional well (NTO-2) in late 2011, subject to various governments? approvals, the company said.

The company also decided to accelerate Indonesian 2011 drilling program by doubling exploration/appraisal wells to six at Batu Gajah with exact timing subject to various approvals after it secured $49.5 million financing in March 2011.

The company initially planned to drill three wells in Batu Gajah and another three wells in Citarum PSC onshore West Java, where it has 77 percent interest.

The entire 2011 Indonesia capital program is now forecast to include nine wells plus the NTO-1ST sidetrack at an estimated cost of $37 million, it said.

Pan Orient is operator of Batu Gajah PSC with 97 percent interest. (romel)