Release: Ephindo secures the first CBM contract in Indonesia

(Jakarta, May 27, 2008) Ephindo and McLaren Resources Inc - under the flag South Sumatera Energy - together with Medco E&P, announced today that it has signed a CBM (Coal Bed Methane) contract with BPMIGAS, witnessed by the Minister of Energy and Mineral Resources, Republic of Indonesia. The signing marks the first CBM Contract and signifies the beginning of CBM industry in Indonesia. The event took place during the opening ceremony of 32nd IPA Convention and Exhibition in Jakarta.

The 30-year contract signing enables the parties to continue with the activities and make the investments required to develop CBM facilities in Musi Banyuasin, South Sumatera. The consortium has appointed Medco to be the operator of the block.

Asian Development Bank (ADB) and MIGAS studies in 2002 revealed that the CBM resource in place in South Sumatera is estimated amounting 183 TCF.

Ephindo?s venture in CBM begins when it acquired coal licenses in South Sumatera back in 2005 and a year after formed a strategic alliance with a reputable coal mining company, Ilthabi.

President and CEO Ephindo, Sammy Hamzah said, ?The signing of this agreement further strengthens our commitment towards the development of CBM in Indonesia. We are ready to continue with the start-up of the project and aim to begin commercial production in 2011.?

John Kontak, Director of South Sumatra Energy representing the Toronto, Canada interests said, ?We are very pleased to be part of this significant milestone in the development of CBM in Indonesia. Our partnership with Ephindo and Medco should ensure the commercial success of the project and a great start to this important new energy sector.? (end of release)