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Lundin Spuds Tembakau Appraisal Well Off Malaysia

|Includes:Lundin Petroleum AB (LNDNF), PNADF

Lundin Petroleum has spud the Tembakau-2 appraisal well located in PM307 off Malaysia. This is the first well in its 2014 Malaysian drilling campaign.

Tembakau-2 is a vertical well to be drilled to a depth of 1,400m in approximately 70m water depth. The drilling of the well, including testing, is expected to take approximately 60 days. The objective of the well is to confirm the current gross contingent resource estimate of gas as well as to test upside resource potential within the structure and to provide reservoir information for development planning.

PM307: Lundin (75%, operator) and Petronas (25%).

Tembakau-2 will appraise the Tembakau-1 discovery, which encountered stacked gas pay sands in Miocene reservoirs. The Tembakau-2 appraisal well will be followed by the Rengas wildcat well in the same block.

Murphy also plans to drill two more wildcats, Kitabu and Maligan, in its 2014 Malaysia drilling program.

In Nov-2013, Lundin Petroleum reported Q3-2013 profit of $1.7 million, down 96% from $44.9 million in Q3-2012. The drop in profits was due to impairment costs from two Malaysian discoveries.

In Nov-2012, Lundin Petroleum spudded Tembakau-1 exploration well in PM307 Block, offshore east coast Peninsula Malaysia.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Stocks: LNDNF, PNADF