CBM Asia Development Corp. ("CBM Asia" or the "Company") (TSX.V:
TCF) (US: CBMDF) (FWB: IY2) reports that further to its news
release of September 19, 2011, wherein the Company announced the
acquisition of majority operating interest in two coalbed methane
production sharing contracts (“PSC”) in Indonesia, the Hulu and
Bentian Besar PSCs, the Company updates its reimbursement
terms with the vendors. Under its agreements, CBM Asia will
reimburse each vendor for certain direct and other costs, up to
USD500,000 on the execution of a joint operating agreement (“JOA”)
(expected in Q2 2012), and up to an additional USD500,000 on the
one-year anniversary of the execution of each JOA.
Mr. Alan Charuk, Chief Executive Officer and President,
commented “We have successfully concluded all negotiations to
acquire majority operating interests in the Hulu and Bentian Besar
coalbed methane PSCs. CBM Asia’s all-in costs are less than USD
4.14 per acre for a gross 966,511 acres, including area extensions
currently under review by the Government of Indonesia. Furthermore,
we have deferred a significant portion of the earn-in costs until
2013.”
The Company’s work program at the Hulu and Bentian Besar PSCs,
scheduled to commence Q2 2012, includes two exploration core holes
and two production test wells on each PSC, with pilot production
programs to follow in Q1 2013. The Company anticipates National
Instrument 51-101 compliant resource estimates for the Hulu and
Bentian Besar PSCs to commence Q4 2012, based on results of the
Company’s 2012 work programs.
HULU PSC
CBM Asia entered into an acquisition agreement with PT Samantak
Mineral Prima (the “Hulu Vendor”) to acquire the right to earn an
operating 70% interest in the Hulu PSC to explore and develop
potential coalbed methane resources within an area encompassing
approximately 519 km2 in Central Sumatra and has submitted an
application to the Government of Indonesia to extend the Hulu PSC
to approximately 1,983 km2.
The Hulu PSC is adjacent to the Trans Sumatra pipeline which
supplies Singapore as well as domestic markets including Java and
the Duri Steamflood, where Talisman Energy reported average gas
delivered gas prices of USD10.14 /Mcf during the Q3 2011 .1
The Hulu Vendor conducted extensive geological study and
contract proposal phases which form the basis of the commercial
terms agreed to by Indonesia's upstream oil and gas regulator
BPMigas in awarding the PSC including a joint evaluation study (the
Study Phase) that included the acquisition and evaluation of
extensive geological data such as existing facies maps, outcrop
data, logs from existing conventional wells, and seismic data.
Under the Hulu Acquisition Agreement, CBM Asia as operator, is
responsible for conducting the lesser of a maximum USD6.5 million
exploration and appraisal program or four core wells over the first
three years to determine commercial feasibility of coalbed methane
production and submit a Plan of Development to the Government of
Indonesia for approval.
BENTIAN BESAR PSC
CBM Asia entered into an acquisition agreement with PT Ridlatama
Mining Utama, (the “Besar Vendor”) to acquire the right to earn an
operating 70% interest in the Bentian Besar PSC to explore and
develop potential coalbed methane resources within an area
encompassing approximately 830 km2 in East Kalimantan and has
submitted an application to the Government of Indonesia to extend
the Besar PSC to approximately 1,930 km2.
The Besar PSC is located approximately 133 km from the gas trunk
line that connects to the Bontang LNG Plant and less than 80 km
from CBM Asia’s Kutai West PSC. BP announced in August 2011 that
coalbed methane produced from its joint venture Sanga Sanga PSC has
been delivered to Bontang LNG since March 2011, resulting in the
world’s first CBM-to-LNG export.
The Besar Vendor conducted extensive geological study and
contract proposal phases which form the basis of the commercial
terms agreed to by BPMigas in awarding the PSC including a joint
evaluation study (the Study Phase) that included the acquisition
and evaluation of extensive geological data such as existing facies
maps, outcrop data, logs from existing conventional wells, and
seismic data.
Under the Besar Acquisition Agreement, CBM Asia as operator, is
responsible for conducting the lesser of a maximum USD6.5 million
exploration and appraisal program or four core wells over the first
three years, to determine commercial feasibility of coalbed methane
production and submit a Plan of Development to the Government of
Indonesia for approval.
ABOUT CBM ASIA DEVELOPMENT CORP.
CBM Asia Development Corp. is a Canadian-based unconventional
gas company with significant coalbed methane ("CBM") exploration
and development opportunities in Indonesia. The Company holds
various participating interests in four production sharing
contracts (each a "PSC") for CBM in Indonesia. Indonesia has one of
the largest CBM resources in the world with a potential 453
trillion cubic feet in-place, more than double the country's
natural gas reserves (Stevens and Hadiyanto, 2004). Since 2008 more
than 30 CBM PSCs have been granted by the Government of Indonesia,
representing exploration commitments of over US$100 million during
the next 3 years. In addition to CBM Asia, other companies active
in CBM exploration in Indonesia include BP, Dart Energy, ENI,
ExxonMobil, Medco, and TOTAL. BP, ENI, Santos and the Indonesian
government have confirmed that commercial CBM production started in
March 2011 from the Sanga-Sanga PSC and is being exported from the
Bontang LNG facility. The Company trades on the TSX Venture
Exchange under the symbol "TCF".www.cbmasia.ca
ON BEHALF OF CBM ASIA DEVELOPMENT CORP.
"Alan T. Charuk"
President & CEO
For further information on CBM Asia Development Corp., please
contact Alan Charuk at (604) 684-2340, or (866) 504-4755, email
corpcom@cbmasia.ca or visit our website at www.cbmasia.ca.
For investor relations contact: Micro Cap et al at 1 877 642
7622, or info@microcapetal.com
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
CBM ASIA DEVELOPMENT CORP.
404-815 Hornby Street Vancouver, BC, V6Z
2E6
T.604.684.2340 F.604.684.2474
TF.866.504.4755
www.cbmasia.ca
This news release contains forward-looking statements, which
relate to future events or future performance and reflect
management’s current expectations and assumptions. Such
forward-looking statements reflect management’s current beliefs and
are based on assumptions made by and information currently
available to the Company. Readers are cautioned that these forward
looking statements are neither promises nor guarantees, and are
subject to risks and uncertainties that may cause future results to
differ materially from those expected. See “Risks and
Uncertainties” in the Company’s annual MD&A dated April 27,
2011 available on SEDAR at www.sedar.com These forward-looking
statements are made as of the date hereof and the Company does not
assume any obligation to update or revise them to reflect new
events or circumstances save as required under applicable
securities legislation. This news release does not constitute an
offer to sell securities and the Company is not soliciting an offer
to buy securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
1 Talisman Energy, Corporate Presentation, November 2, 2011, p.
23.
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