Natural gas found in South Sumatra

Natural gas found in South Sumatra

CALGARY, Canada (Reuter): Gulf Canada Resources Ltd said on
Monday that Indonesia unit Asamera South Jambi Ltd made a natural
gas discovery in South Sumatra that flowed 36.5 million cubic
feet per day of raw natural gas from four geological zones.

Gulf said the Bungkal-1 wildcat well, in which Asamera is
operator and holds a 45 percent interest, was drilled to a total
depth of 3,000 meters, penetrating over 700 meters of gas column
with 98 meters of calculated net pay.

Bungkal-1, which began drilling on October 1995, is located in
the South Jambi B Production Sharing Contract area.

Gulf said the discovery well is 13 kms (eight miles) northwest
of Dayung, the largest gas field being developed as part of the
massive Corridor Block gas project.

The US$600-million project, being developed with partner
Talisman Energy Inc and Indonesia state oil company Pertamina, is
expected to see 300 million cubic feet of gas per day flowing by
late 1997.

"The proximity of the discovery to the pipeline to be built in
conjunction with the Corridor Project enhances Bungkal's
development potential," Gulf said.

The company said the well's production flowed with a carbon
dioxide content of 60 percent on a dry gas basis, which equates
to about 15 million cubic feet per day of sales gas.

Gulf said the structure appears to contain significant gas
reserves which will be tested over the next month.

Partners in the gas play include Pertamina with 25 percent
interest and Total unit Total Oil & Gas South Jambi BV with 30
percent.

The companies plan to conduct delineation seismic in 1996 and
additional drilling in 1997 to assess the vertical and aerial
extent of the Bungkal-1 discovery, Gulf said.