Drilling is expected to take about 90 days to reach a total measured depth of 5500 metres, or 5200 metres vertical depth, Cue said.
Jeruk-3 is a deviated well to penetrate the objective Kujung carbonate in the central crestal area of the Jeruk structure.
The Jeruk oil discovery is about 40km southeast of Surabaya, in the offshore Sampang Production Sharing Contract, East Java.
Earlier this month, Cue Resources announced it would surrender nearly 7% of its 15% stake to Indonesian-based Medco Strait Services to earn revenues from the field and be reimbursed for past costs.
In September, Santos announced that Jeruk was flowing oil at 3000 barrels a day with gas from the Jeruk-2 appraisal sidetrack. At the time, these results raised hopes that Jeruk could be bigger than the pre-drill estimate of 170 million barrels.
Suggestions of it being a 500 million barrel find came during early enthusiasm for Jeruk-2 results. But Jeruk has proven to be muhc more geologically complex than at first anticipated. Santos said that any upgrade to its estimates would wait until the results of Jeruk 3-6 were known.
Economic interests in the well are expected to be: Santos Sampang Pty Ltd (operator - 40.5%); Medco Strait Services* (22.5% - pursuant to an agreement with Singapore Petroleum and Cue); Singapore Petroleum Sampang Pte Ltd (19.64% ); PT Petrogas Oyong Jatim (10%); and Cue Sampang Pty Ltd (7.36%).
Meanwhile, Cue also posted its December quarterly report, citing A$9.4 million cash at the end of 2005.
The company said highlights during the quarter at the SE Gobe field in Papua New Guinea included A$1.8 million revenue and completing construction of a new drilling pad for additional production wells.
In New Zealand, Cue was granted a petroleum mining permit for the Maari field. In addition, Cue issued letters of intent for constructing the Maari well head platform and for the floating production, storage and offtake (FPSO) vessel.
At home, Cue obtained a 20% interest in AC/P20 in the Timor Sea, which contains the Maple - Cash gas field.
