Press releases

South Kecapi-1 DIR/ST Oil and Gas Discovery

04 February 2013

Salamander Energy plc announces that the South Kecapi-1 DIR/ST exploration well (“SK-1”) in the Bontang PSC has been completed as an oil and gas discovery. South Kecapi is the first well in Salamander’s multi-well programme in the North Kutei basin.

SK-1 discovered a combined 40 m of net oil and gas pay in high quality stacked Pliocene channel sandstones. A drill stem test (“DST”) was conducted within one of the well’s primary targets; a well-developed, Pliocene-age channel sandstone, which flowed light oil at a rate of c. 6,000 barrels of oil per day (constrained by testing equipment) and 8 MMscf per day of gas. The well is being plugged and abandoned as an oil and gas discovery.

SK-1 was drilled using the Ocean General semi-submersible rig, reaching a total depth (“TD”) of 2,102 m true vertical depth sub-sea (“TVDSS”). Higher pressures than anticipated and numerous gas kicks were encountered throughout the early Pliocene section which is believed to be indicative of a hydrocarbon-charging system that is extremely active.

Primary Targets (BT45 and BT50 channels)

The well encountered 11 metres of net oil pay in high quality early Pliocene channel sandstones (BT45) which represent the upper primary target of the well at 1,722 m TVDSS. A DST was conducted across a five metre interval of the oil-bearing reservoir which flowed at a rate of c. 6,000 bopd on a 52/64” choke, without any produced water. The oil is a light, sweet 33.4 degree API crude with a GOR of 1,333 scf/bbl.

Wire-line and pressure data have confirmed the presence of an oil-water contact within these well-developed channel sandstones. The lower primary Upper Miocene target (BT50) was found to have limited sand development at this location.

Secondary Targets (BT18 - BT25 channels)

In the shallowest target, the BT18, the well found three channel sandstones each with gas to base totalling 24 m of net pay. In the BT25 target a 5 m thick sand channel with gas to base was encountered.

A full evaluation suite of pressure and fluid sampling together with wire-line log analysis and collection of gas samples provides evidence for excellent quality reservoir characteristics, with porosities exceeding 30 % and excellent gas mobilities within these sandstone sequences.

In addition, two long sections of thin-bedded pay were encountered in the shallow section of the well. A micro-resistivity log was run, indicating a significant potential net pay addition. Further work is on-going to determine the resource potential of these zones.

Resource Potential

Work is currently underway to confirm the range of volume of discovered resource. Salamander does not believe the gas resource discovered in the main channels necessarily represents a commercial volume on a stand-alone basis and work continues to define the additional resource potential of the thinner sands. However, with light oil discovered at South Kecapi in well-developed, high quality reservoir on the down dip, western flank of the large Bedug structure, there is a material upside case for both oil and gas.

The crest of the Bedug structure lies 4 km east and 500 m up-dip of the SK-1 well location and the initial view of the range of potential recoverable oil resource discovered in the BT45 primary target reservoir alone is between 13 MMbbl and 133 MMbbl. Further appraisal of this interval, together with the drilling of additional target channel sequences with the Bedug-1 exploration well will help further define resources.

Forward Programme

Having established the oil-water contact in the primary target reservoir section, Salamander has elected not to undertake the previously planned down-dip side-track of the well, rather attention turns to the up-dip potential in the Bedug structure.

While work continues on integrating the new well data into the assessment of potential in the Bontang PSC, the rig will now move directly to the South East Sangatta PSC to drill the North Kendang-1 exploration well.

James Menzies, Chief Executive of Salamander, commented:

“Our first well in the basin, the Angklung discovery, opened the play, while SK-1, our second well, has validated the geological model, discovered hydrocarbon-bearing, high-quality channel sandstone sequences and delivered an excellent DST result, flowing 6,000 bopd on test. We are very encouraged by these results and are now moving on to drill one of the largest structures in the basin at the North Kendang location before bringing the rig back to drill the Bedug high, up-dip of the South Kecapi oil discovery.”




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) and is a constituent of the FTSE 250 index. 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.