Salamander reports Indonesian ops update

The following is an edited excerpt taken from UK oil, gas firm Salamander Energy Plc?s an Interim Management Statement relating to the period from 1 July 2009 to 18 November 2009, released on Thursday. (ed)

Operation

Glagah Kambuna TAC (Salamander operator, 50% interest)
The Kambuna gas condensate field (Salamander 50%) was brought on stream on 11 August 2009. Production ramped up over the following weeks and by mid-September the field was producing at the full Daily Contracted Quantity (DCQ).

On 25 September production was shut in at the request of the off-taker due to a problem with the turbines at the Belawan Power Plant. The off-taker conducted a full investigation into the problem concluding that the cause was liquid hydrocarbons appearing at the turbine burners. Production from the Kambuna field was restarted on 7 November 2009 at an initial rate of 10 MMscfd. It has been accepted by all parties that Kambuna gas was delivered as per specification and there is a take or pay clause within the gas sales agreement which can be invoked if volumes are not made up within the first year.

The focus of the Kambuna project is now on completion of the permanent onshore receiving facilities at Pangkalan Brandan. This work is expected to be completed towards the end of the first quarter of 2010. Once these facilities are in place, the Group expects to advance discussions on marketing additional volumes of gas above the current contracted amount of 40 MMscfd.

ONWJ & SES (Salamander 5% interest each)
The operatorship of the Offshore Northwest Java PSC (Salamander 5%) was transferred from BP to Pertamina on completion of the sale of BP's 46 per cent interest in the licence. A programme of infill development drilling commenced in October 2009 and production has increased since the change of operator. During Q3 gross production from Offshore Northwest Java averaged 66,000 boepd.

An exploration and infill development drilling programme was completed during Q3 2009 in the Southeast Sumatra PSC (Salamander 5%). Gross production averaged 68,000 boepd during the third quarter.

Exploration

Bengara-1 PSC (Salamander 25% interest)
On 13 August 2009 the Group announced that the South Sebuku-1 exploration well in the Bengara-1 PSC encountered gas in four zones. Two of these were tested and flowed at a cumulative rate of 10.9 MMscfd. The discovery will be appraised during 2010 with a view to tying it in to the South Sembakung field in Simenggaris JOB-PSC (Salamander 21%interest) that is located only 15km away and is expected to be developed during 2010 and 2011.(end of edited excerpt)