NuEnergy Gas has completed permeability tests on pilot well #2 and commenced coalseam gas (CSG) flaring and dewatering at the Muara Enim production-sharing contract site in South Sumatra, Indonesia, according to a company press release.

NuEnergy has also installed fishbone completions across the J coal seam and preperforated casing across the H, J, K, and L coal seams. Permeability was tested across all of these seams with results ranging between 2.44 millidarcy and 30.15 millidarcy, the company said.

NuEnergy said that the permeability results and CSG flare provide further confidence that the project is progressing toward becoming a viable gas production site.

The company is now analyzing these results with a view to identifying the most gas productive coal seam to be drilled and completed horizontally at the #3 site, which is 300 m (984 ft) from pilot well #2.

Compressed natural gas producer Dharma Pratama Sejati has agreed to offtake between 1 million scf and 5 million scf of gas at US $10 per million Btu. This represents potential gross revenue of between $10,000 and $50,000 a day, or between $3.6 million to $18.2 million a year to the joint venture, NuEnergy said.