2009-08-17-2008-08-01

To acquire 15% in Glagah-Kambuna TAC offshore, 23.4% in Kutai PSC onshore/offshore.

A subsidiary of Salamander Energy Plc, London, (London: SMDR) plans to acquire a 15% interest in the Glagah-Kambuna technical assistance contract offshore Indonesia and a 23.4% interest in the Kutai production-sharing contract onshore and offshore Indonesia from Serica Energy Plc, London, (London Aim: SQZ) for US$52.75 million. The Kambuna contract is 40 kilometers offshore northern Sumatra, Indonesia, and contains the Kambuna gas condensate field in which Serica and Salamander currently hold interests of 65% and 35% respectively. The field is expected to be producing by the end of the year. Production is expected to be 50 million cubic feet of gas and up to 5,000 barrels of condensate per day after fully commissioning the onshore facilities in early 2009. Pro forma, Serica and Salamander will each hold 50% interest in the contract. The Kutai contract is onshore and offshore East Kalimantan, Indonesia, and is an early-stage exploration block operated by Serica, which holds 78% interest. Both 2-D and 3-D seismic surveys are planned this year to assist exploratory drilling in 2009. Pro forma, Serica will hold a 54.6% interest in the contract. Serica chief executive Paul Ellis says, "This is an excellent deal for Serica, as it demonstrates the viability of our strategy of creating and then realizing a portion of the shareholder value added through the drillbit since our initial success at Kambuna at the end of 2005. In addition, from next year we will begin to enjoy significant cash flow from our retained 50% interest in the field." Serica will use the proceeds to fund exploration programs in the North Sea, Indonesian, Vietnam, the U.K. and Ireland.