Salamander initiates insurance claim on North Kendang campaign

Salamander Energy, the FTSE 250 oil and gas group, has announced an on-going insurance claim related to the North Kendang drilling campaign in Indonesia.

Following discussions between a number of parties, it was concluded that the previously reported challenges at the North Kendang-1 exploration well - resulting primarily from high pressures - may have given rise to valid insurance claims.

The two insurance claims, totally $20m, cover the recovery of costs associated with bringing the well under control, the cost of contractor equipment lost or damaged by the well control incident, and costs involved in a re-drill of the North Kendang-1 well.

Final settlement of claims is not anticipated before end of 2013, the group said.

The campaign at North Kendang has so far resulted in the South Kecapi oil and gas discovery and a suspended potential gas discovery at North Kendang-1. Operations on the Bedug-1 exploration well continue, Salamander added.

The share price fell 0.73% to 203.50 by 08:50 Wednesday.

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