CBM Asia Development Corp.
TSX VENTURE : TCF
FRANKFURT : IY2
OTC Bulletin Board : CBMDF

CBM Asia Development Corp.

March 07, 2011 18:59 ET

CBM Asia Prepares for Production Testing of Sekayu Project, South Sumatra

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 7, 2011) - CBM Asia Development Corp. (TSX VENTURE:TCF)(US:CBMDF)(FRANKFURT:IY2) ("CBM Asia" or the "Company") announces today that its operating partner MedcoEnergi reported it is mobilizing a workover rig to the CBM-SE-02 well at the Sekayu coalbed methane exploration project in South Sumatra, Indonesia.

Medco plans to install a downhole pump and zone isolation packer to dewater the Palembang B & C and Pangadang A coal seams, providing data on deep-radius reservoir permeability and water composition. Medco also has contracted Weatherford International to conduct gas saturation testing at this well. Later in March, Medco plans to begin coring the coal section for gas content and permeability testing in the three other CBM test wells located in the deeper portion of the Sekayu Project.

The CBM-SE-02 well has provided data on coal seam thickness and permeability, while the upcoming coring of the CBM-SE-01, -03 & -04 wells will help further define CBM resources on the block, providing critical input in support of the Company's planned NI 51-101 resource estimate.

Corporate Update

Subject to TSX Venture approval, CBM Asia has granted 2,726,000 stock options with an exercise price of 0.17 per share and an expiry date of five years to employees and consultants. Furthermore, the Company is making application to re-price 1,666,000 previously issued options with an exercise price of 0.17 per share and an expiry date of five years. Of the total options to be re-priced, 1,433,000 are for directors and officers which are subject to shareholder approval.

About MedcoEnergi.

Listed on the Jakarta Stock Exchange, MedcoEnergi is the largest independent oil & gas company in Indonesia. MedcoEnergi has transformed itself from a local producer into a global energy company operating in Indonesia and overseas, with focus on oil and gas, power generation and renewable fuels.

About CBM Asia.

CBM Asia Development Corp. is a Canadian-based unconventional gas company with significant coalbed methane ("CBM") exploration and development opportunities in Indonesia. The Company has entered into a binding letter of intent to acquire a participating interest in a production sharing contract ("PSC") for CBM on a 58,349-hectare block located in the South Sumatra Basin where initial exploration drilling of a production test well commenced in the second half of 2009. The Company has committed to fund an initial US$3.25 million in exploration expenditures on the Sekayu PSC to prove reserves and submit a Plan of Development to the Government of Indonesia. Sekayu Block Interests of the Company, Ephindo and Batavia Energy are held in South Sumatra Energy, Inc. The Company also has an 18% net working interest in a PSC for CBM on a 76,000-hectare block located in the Kutai Basin of East Kalimantan. Indonesia has one of the largest CBM resources in the world with a potential 453 trillion cubic feet in-place, more than double the country's natural gas reserves (Stevens and Hadiyanto, 2004). Since May 2008 more than 20 CBM PSCs have been granted by the Government of Indonesia, representing exploration commitments in excess of US$100 million over the next 3 years. The Company trades on the TSX Venture Exchange under the symbol "TCF" (www.cbmasia.ca).

ON BEHALF OF CBM ASIA DEVELOPMENT CORP.

Alan T. Charuk, President & CEO

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information