Arrow Energy says that Arrow and Ephindo-Ilthabi CBM Holding Inc. (Ephindo), a subsidiary of Ephindo group of companies, have reached agreement, subject to final documentation, on a farm-in proposal to Ephindo’s Sangatta CBM block in East Kalimantan and have agreed to discuss other potential cooperation in exploration and development of CBM resources in, Indonesia.

Ephindo was awarded operatorship of a CBM Production Sharing Contract in a consortium with PT Pertamina Hulu Energi Metan A, a subsidiary of state oil and gas company PT Pertamina, on the Sangatta I Block in November 2008. The working area is approximately 1,300 sq. km.

Arrow and Ephindo intend to develop a corporate partnership aimed at jointly operating this PSC and with the aim of further extending this partnership into other related areas of interest based on the successful development of this relationship.

Arrow CEO Nick Davies stated that “Arrow is very pleased to have reached this cooperation agreement with Ephindo. The combination of Arrow’s CBM expertise with Ephindo’s local capabilities will set a strong foundation for CBM development in Indonesia. Arrow is particularly pleased to be able to start near term drilling operations on a quality block in Indonesia, in close proximity to the Bontang LNG plant”

Tags: Arrow Energy Ltd, Ephindo-Ilthabi CBM Holding Inc.