Conference Call Numbers:
Canada & USA Toll Free Dial In: 1-800-319-4610, UK Toll Free 0808-101-2791, local Vancouver 604 638 5340 or Outside Canada, USA or the UK Call: 1-604-638-5340.
The call is being webcast and can be accessed at CBM Asia’s website at cbmasia.ca/ or enter the following URL into your web browser: services.choruscall.com/links/cbm130110.html
CBM Asia-ExxonMobil Joint Venture Background
On December 20, 2012 CBM Asia announced it signed a farm-in joint venture agreement with ExxonMobil. The final terms and conditions of the proposed farm-in remain subject to negotiation and execution of formal agreements between ExxonMobil and CBM Asia as well as, among other conditions, government approvals. Under the farm-in joint venture agreement the Company will acquire a 35% to 37.5% participating interest in four existing PSCs (Banjar I PSC, Banjar II PSC, Barito I PSC and Tapin PSC) in the Barito Basin, South Kalimantan. The total gross area of the four PSCs is approximately 4,258 km2 or 1.0 million acres. CBM Asia considers the Barito Basin to be the largest and best undeveloped CBM exploration opportunity in the world, with an industry gas-in-place estimate of 102 Tcf(1). Details of the farm-in joint venture include:
— CBM Asia will provide assistance to drill and conduct two 5-well
production pilots at its sole cost: one in the Banjar II PSC and the
second in the Barito I PSC. CBM Asia and ExxonMobil will complete
remaining exploratory drilling obligations under the applicable Firm
Commitment work programs for the Banjar I, Banjar II and Barito I PSCs,
sharing costs equally. CBM Asia will fulfill its farm-in commitment on
completion of these pilots and exploratory drilling. CBM Asia estimates
the total cost of the farm-in commitment to be USD15 million, with most
expenditures expected to occur over a period of approximately 12 months
starting in June 2013.
— Depending on the results of the planned 5-well production pilots in the
Banjar II and Barito I PSCs, CBM Asia will have the option to
participate in completion of the Tapin PSC Firm Commitment work program,
paying 50% of the Firm Commitment work program costs.
— The CBM Asia ExxonMobil farm-in joint venture also provides the
potential opportunity for CBM Asia to participate alongside ExxonMobil
in three existing PSCs and future PSCs tendered by the Government of
Indonesia in the area of three completed Joint Studies in the Kutai
Basin, East Kalimantan. The total gross area of the six PSCs/Joint
Studies is approximately 8,859 km2 or 2.2 million acres. Subject to
government approval and upon ExxonMobil acquiring its PI in one or more
of such existing and future PSCs, ExxonMobil will farm out/assign 50% of
its PI to CBM Asia. All exploration costs will be split evenly between
CBM Asia and ExxonMobil. Subject to Government of Indonesia approval,
CBM Asia will act as nominee operator.
1. Society of Petroleum Engineers Paper 88630 (not NI 51-101 compliant)
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 five 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 a total of 54 CBM PSCs have been granted by the Government of Indonesia, representing exploration commitments of well 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, Santos, and TOTAL. BP, ENI, 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”. cbmasia.ca
ON BEHALF OF CBM ASIA DEVELOPMENT CORP.
Alan T. Charuk, President & CEO
The gas in place estimates referred to herein have not be classified as “discovered petroleum initially-in-place” within the meaning of the Canadian Oil & Gas Evaluation Handbook (COGE Handbook). The term “discovered petroleum initially-in-place” is equivalent to discovered resources, and is defined in the COGE Handbook to mean that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production. There are no assurances that any portion of the estimated gas in place resources will be discovered. Furthermore, the above estimates make no allowance for the recovery of the gas which will depend on, among other things, the reservoir characteristics encountered and future economic conditions.
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. Specifically, the proposed farm-in arrangement with ExxonMobil referred to herein is subject to, inter alia, the negotiation and execution of formal agreements, governmental and third party approvals, satisfactory due diligence and available financing. There are no assurances that the Company will be successful in entering into formal agreements with ExxonMobil on commercially acceptable terms or at all. All of the forward-looking statements made in this news release are qualified by these cautionary statements and those made in our Canadian continuous disclosure filings available on SEDAR at sedar.com including our December 31, 2011 year end annual MD&A dated April 26, 2012 and second quarter 2012 interim MD&A dated August 28, 2012. 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.
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.
(604) 684-2340 or (866) 504-4755
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