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Thursday, September 1, 2011

Sub-Commercial Discovery Disappoints Salamander Offshore Vietnam

- Sub-Commercial Discovery Disappoints Salamander Offshore Vietnam

Thursday, September 01, 2011
Salamander Energy plc

Salamander announced the completion of the Cat Ba-1X ("101-CB-1X") exploration well in Block 101-100/04, offshore northern Vietnam. Block 101-100/04 was the subject of a farm out as announced on May 31, 2011.

The 101-CB-1X well was drilled to a total depth of 1,724 meters. The well encountered 38 meters of net hydrocarbon pay in Tertiary clastics, the secondary objective of the well. The pay section comprises a series of gas-bearing sandstones underlain by an oil-bearing reservoir. A full suite of wire-line logs and pressure data were recorded over the reservoir sections and samples of oil and gas were recovered.

These data show that the Tertiary reservoirs are of good quality, however pressure data and seismic mapping indicates the in-place resource volumes encountered by the well are probably below levels needed for commercial development.

No oil shows were observed and only low levels of gas were recorded while drilling the primary objective, the Palaeozoic 'buried hills' play. Subsequent wire-line logging did not reveal any zones of interest. The Cat Ba-1X well has subsequently been plugged and abandoned as a sub-commercial discovery.

James Menzies, Chief Executive, Salamander Energy, said, "While a sub-commercial find is disappointing, we have an active drilling program into 2012 which sees a mix of exploration, appraisal and development around our three primary areas of focus. These are proven regional plays, where we believe we can create significant value."

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