Canadian Manufacturing

CBM Asia plans pilot projects in Indonesia coalbed methane in 2013

Vancouver-based firm planning five-well production pilots in the Barito and Central Sumatra Basins


VANCOUVER—CBM Asia Development Corp., which announced a partnership with ExxonMobil Corp. last month, said it’s planning two pilot coal-bed methane projects in Indonesia this year.

CBM Asia is responsible for 100 per cent of the capital cost of both pilots.

The Vancouver-based company said the program is designed to see first commercial gas flows, upgrade resources and to potentially generate CBM Asia’s first revenues.

CBM Asia is planning five-well production pilots in the Barito and Central Sumatra Basins, with drilling set to begin in June and October, respectively.

If production rates are satisfactory, CBM intends to sell the gas from both pilots to a small-scale power production unit.

“We believe there is enough geological evidence to support an accelerated drive into small-scale production pilots,” said CBM Asia CEO Alan Charuk.

Through the ExxonMobil deal, CBM will acquire 35 to 37 per cent interests in four Barito Basin production contracts held by ExxonMobil in return for funding some of the costs.

CBM Asia also has the right to farm into 50 per cent of ExxonMobil’s future participating interest in contracts in the Kutai Basin.

Demand for the gas is expected to come from nearby regional urban centres and the large coal mining industry.

A liquefied natural gas facility in the area will enable the gas to be condensed and transported to north Asian markets.

“CBM Asia considers the Barito Basin to be one of the world’s best undeveloped CBM basins,” said CBM chairman Scott Stevens.

He said the Barito Basin holds about 100-trillion cubic feet of natural gas in place, out of about 453-trillion cubic feet throughout Indonesia, based on industry estimates.

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