Press releases

Interim Management Statement

14 November 2013

Salamander Energy plc issues the following Interim Management Statement (IMS) for the period from 1 July 2013 to 13 November 2013.

Production and Development Activity

  • Group production averaged 14,400 boepd in the year to 31 October
    • Full year 2013 production guidance narrowed to 14,000 – 15,000 boepd
    • Group production guidance for 2014 is 13,000-16,000 bopd
  • Bualuang production averaged 12,300 bopd in the year to 31 October. With the eleventh of the 16 Bravo development wells completed and brought on stream towards the end of October, field production during November has been running at 12,900 bopd
  • New well data acquired during the on-going Bravo drilling programme has allowed the Group to undertake a detailed appraisal of the undeveloped resources in the Bualuang field.
    • There is a sharp increase in management’s estimate of oil-originally-in-place of circa 30% from 189 MMbo to over 250 MMbo
    • It is expected that this will see the booking of additional 2P reserves and contingent resource at year end 2013
    • A Front End Engineering Design (FEED) study has commenced with a view to installing a third platform on the Bualuang field, project sanction is likely in mid-2014
  • The cost reduction initiative at Bualuang remains on schedule for the FPSO to be replaced with an FSO in 3Q 2014
    • Processing and power modules 87% complete and scheduled to be loaded out in December 2013
    • Navion Clipper conversion to an FSO is 60% complete
  • The Kerendan field development remains on schedule for first production at the end of 3Q 2014
    • The off-taker (PLN) has awarded the contract for construction of the power plant to Wartsila and construction activity is well advanced
    • PLN has up-scaled phase 1 of the project: the initial capacity of the power plant has been expanded to 150 MW and additional transmission lines are planned increasing the connectivity to the rest of the Kalimantan grid
    • Following completion of the initial Kerendan development drilling campaign, Salamander and the Indonesian regulator have begun the process of re-certifying field resources with a view to ultimately agreeing additional gas sales volumes beyond the current Gas Sales Agreement

Exploration and Appraisal


  • The EIA application for permits for the preferred exploration targets in the G4/50 licence was not approved during 3Q 2013
    • As a result of a (non-Salamander related) oil spill in the north of the Gulf of Thailand all subsequent offshore EIA applications have been pushed back with applicants being asked to review oil spill response plans in light of the recent event
    • Salamander intends to resubmit the revised EIA application before year end 2013
  • Sinphuhorm East well (“SPHE-1ST”) has been suspended
    • SPHE-1ST tested over 50 MMscfd at a restricted rate from the Permian-aged Pha Nok Khao formation reservoir, a commercial flow rate and one of the best production rates seen in the field
    • The well was drilled to a total depth of 2,374 m TVDSS. Rather than continue drilling operations and risk losing a future producer, the operator has elected to suspend the well
    • The well has proven the extension of the Sinphuhorm gas field outside of the production licence (Salamander net 9.5%) and into the adjoining block L15/43 (where Salamander has a higher equity interest at 27.2%) and demonstrated the ability of the 3D seismic to identify reservoir zones of greater deliverability.
  • Drilling operations commenced on the West Kerendan exploration prospect in Indonesia
    • The well is targeting approximately 900 Bcf in two target horizons
    • A discovery of 500 Bcf or more would open up the possibility of piping gas to the East Coast where gas prices are $2 - $3 per Mcf higher than in the local market
  • Post well analysis on the Kutei programme continues with a view to following up the North Kendang and South Kecapi discoveries in 2014. The Group intends to fund these wells through insurance proceeds and a farm out respectively, therefore not exposing the balance sheet to these higher cost wells< >Rig identified for the re-drill of the North Kendang-1 well that will be available to drill towards the end of 1Q 2014 with the insurance claim covering the vast majority of the well costs

    Technical review of the South Kecapi oil discovery nearing completion at which point a farm out process will be initiated to secure a partner ahead of appraisal drilling

    As at 31 October the Group had cash and funds of $141.0 MM

    • Gross debt (including the convertible bond) stood at $418.7 MM
    • Net debt was $277.7 MM
  • Capital expenditure in 2013 is in line with previous guidance of $350-375 MM
    • Capital expenditure in 2014 expected to be between $250-275 MM
    • E&A expenditure will be markedly lower in 2014 than in 2013 with approximately 25% of the budget allocated to E&A and the remaining 75% being allocated to P&D activity
    • E&A activity will be focused in core areas to provide lower cost, more tax efficient programme of activity
  • The Group has today announced that it is contemplating issuing a Senior Unsecured Bond of up to $150 MM
    • Up to $100 MM to be used to repay the convertible bond
    • $50 MM to be used to repay the Kerendan Bridge Facility



Salamander Energy     
+ 44 (0)20 7432 2680
James Menzies, Chief Executive Officer     
Geoff Callow, Head of Corporate Affairs     
Brunswick Group     
+44 (0)20 7404 5959
Patrick Handley     
Elizabeth Adams  


About Salamander

Salamander Energy is an independent upstream oil and gas exploration and production company listed on the main market of the London Stock Exchange (Ticker: SMDR). The Group is focused on growth assets in and around three core areas: Greater Bualuang, Gulf of Thailand; North Kutei, Indonesia; and Greater Kerendan, Indonesia. In each of these areas the Group has a material, operated position and a detailed understanding of the petroleum systems of the basin.