Salamander sees production spurt from Thai gusher

Production growth gushed up at Salamander Energy as first oil flowed from its key Thai offshore development.

Production growth gushed up at Salamander Energy as first oil flowed from its key Thai offshore development.

However, the North Kendang follow-up exploration project in Indonesia has been suspended due to equipment constraints from unexpectedly high pressures.

The company said it remained encouraged by the results from North Kendang, but would require time to source and import necessary pressure-handling equipment or an entirely new rig.

Across the whole group 17,100 barrels of oil per day were produced in May, up from an average of 10,800 the previous year, as a new platform at the Bualuang field offshore Thailand was installed and led to a sharp rise in production.

In the year to April 30th production across the group has averaged 14,100 barrels of oil equivalent, and the company continues to maintain its guidance of 12,500-15,500 group annual average daily production.

The principal driver of the Bualuang production increase was eight development wells were brought on stream from the new 'Bravo' platform, which performed well ahead of expectations, with average daily production from this field alone in the year to date from the field being 11,300 barrels per day, and 14,300 in May.

Salamander, which continues to try and reduce long-term costs with new support facilities in the area, will now move Bravo to drill exploration wells on the nearby 'G4/50' block, where it has identified more than 60 prospects and leads.

In Indonesia, apart from the North Kendang hold-up there was an encouraging start to exploration at North Kutei offshore, with an oil and gas discovery that flowed at 6,000 barrels of oil per day on test, while four development wells were completed at the onshore Kerendan gas field and flowed at a higher level than required for its initial gas sales agreement.

Results are also due imminently from the Bedug-1 exploration drilling programme in the Bontang PSC Indonesia.

The group's acreage position increased over sevenfold in the period, with two new licenses signed in Greater Kerendan area.

Shares in Salamander Energy were up 0.6% at 196.4p at 08:50 on Monday.

OH

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Bitcoin: fool’s gold or the new gold?
Bitcoin

Bitcoin: fool’s gold or the new gold?

With bitcoin hitting new highs last week, and close to becoming a mainstream investment, is it really gold for the 21st century?
15 Jan 2021
The MoneyWeek Podcast: bitcoin special
Bitcoin

The MoneyWeek Podcast: bitcoin special

Merryn talks to bitcoin experts Dominic Frisby and Charlie Morris to get the lowdown on the cryptocurrency to find out why it's such a huge global phe…
15 Jan 2021
Leasehold reforms promise the end of a nightmare for many homeowners
Property

Leasehold reforms promise the end of a nightmare for many homeowners

Horror stories about unscrupulous landlords profiting from a legal relic of the feudal era are about to get a happy ending, says Simon Wilson.
16 Jan 2021
Free 6 issue trial then continue to