i guess the gas is leaking big time - i meant news is leaking...nice volume and nice gain. They are slated to release results from 3 more drillings and to have a bankable feasebility reserve report by July, the recent gains may be eclipsed big time. They will have a 24% working interest in one of the best CBM in Sumatra 120 ft of coal seams and very rich in gas.
I know its a flimpsy company, finances etc, i mean they even awarded themselves more options on friday at .20 cents...i guess they try to make up for low salaries etc.
see link below about the formation where they are drilling.
On November 10, 2009, the Company announced that it had elected to enter into a revised letter of intent ("Revised LOI") with Batavia Energy Inc. ("Batavia") to acquire 24 percent of South Sumatra Energy Inc. ("SSE") which together with PT Medco CBM Sekayu ("PT Medco"), holds a Production Sharing Contract ("PSC") for coalbed methane on the 58,349 hectare Sekayu Block located in the South Sumatra Basin (the "Sekayu PSC"), Indonesia. Awarded May 27, 2008, the Sekayu PSC marked the first time the Government of Indonesia's Executive Agency for Upstream Oil and Natural Gas Activities ("BPMigas") awarded a PSC for the exploration and development of coalbed methane in Indonesia. PT Medco Energi Internasional Tbk ("Medco"), Indonesia's leading independent oil and gas company, a consortium member of PT Medco and operator of the Sekayu PSC, forecasted first commercial coalbed methane production to begin in 2011 and peak in six years.
Under the terms of the Revised LOI, CBM Asia is required to make a cash payment of US$1,000,000 upon closing of the acquisition and incur exploration expenditures totalling US$3,243,500 under the Sekayu PSC on or before December 31, 2012, to earn an estimated 12% working interest in the Sekayu PSC. The Revised LOI will also grant CBM Asia the sole and exclusive right to provide financing for up to an additional 24% interest in SSE, representing the remaining estimated 12% working interest in the Sekayu PSC. Initial exploration drilling for the Sekayu PSC commenced in September 2009.
Summary of Typical CBM Reservoir Properties of Indonesian Coal Basins[1]
Basin Province Target Form- ation Completeable Coal Thickness Coal Rank Avg Depth High Graded Area CBM Complet- Able Resources Concen- Tration
(m) (R0%) (m) (km2) (Tcf) (Bcf/mi2)
1 S. Sumatra Sumatra M.Enim 37 0.47 762 7,350 183.0 24.9
Source: Stevens, S. "Indonesia Coalbed Methane Indicators and Basin Evaluation", presented at SPE Asia Pacific Oil and Gas Conference and Exhibit, Perth, Australia, 18-20 October, 2004, SPE 88630, Advanced Resources International, Inc. on behalf of Hadiyanto, Indonesian Ministry of Energy and Mineral Resources, Directorate General of Geology and Mineral Resources.
Study Phase - Completed From February 2007 to April 2007, an initial study to evaluate the resources and describe the field development plan for commercial production for coalbed methane was completed for the Sekayu Block located in the South Sumatra Basin, Indonesia. A cooperation contract was submitted to the Government of Indonesia's Executive Agency for Upstream Oil and Natural Gas Activities ("BPMigas"), for production sharing on the Sekayu Block which is in close proximity to gas transmission lines providing access to markets on Java and Singapore. BPMigas awarded a Production Sharing Contract ("PSC") for exploration and development of coalbed methane on the Sekayu Block ("Sekayu PSC") on May 27, 2008. The Sekayu PSC marked the first time the Government of Indonesia awarded a PSC for coalbed methane in Indonesia under its new framework for development of unconventional resources and initiated the country's rapidly emerging multi-basin coalbed methane industry.
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Regional Geology of the South Sumatra Basin Regionally, South Sumatra Basin is situated in the southern part of Sumatra Island, and is part of a Tertiary back-arc basin series. The Muara Enim Formation is the principal target of coalbed methane exploration and production. Thickness of this formation in the area is approximately 500 to 700 meters, about 15% of which is coal in seams that are widely distributed vertically and laterally. The Muara Enim Formation is also exposed in the middle and southwestern parts of the study area.
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