Pertamina EP Plans $400 Million E&P Spend in 2014

Fri, March 07 2014, 11:18 AM

Raras Cahyafitri and Arya Dipa, The Jakarta Post, Jakarta/ Bandung, west java | Business

Pertamina EP, the upstream subsidiary of state-owned oil and gas giant PT Pertamina, will allocate US$400 million to drilling activities this year to seek new sources to maintain production.

Pertamina’s other subsidiary, PT Pertamina Geothermal Energy (PGE), allocated US$250 million in capital expenditure (capex) this year to finance eight projects related to the development of geothermal resources.

Pertamina EP operation and production director Satoto Agustono said the allocated funds would be used to finance drilling at up to 87 development wells nationwide.

“Most of the wells are located in the eastern part of Indonesia,” he said, adding that the firm had spent about $460 million on drilling 111 wells last year.

Satoto said the company was also planning to work on around 12 to 14 exploration wells, with each well roughly costing up to $15 million.

Pertamia EP’s working areas, which span up to 113,613 square kilometers, are divided into five assets.

The first asset consists of Rantau, Pangkalan Susu, Lirik, Jambi and Ramba; the second asset Prabumulih, Pendopo, Limau and Adera; the third asset Subang, Jatibarang and Tambun; the fourth asset Cepu; and the fifth asset Sangatta, Bunyu, Tanjung, Sanga-sanga, Tarakan and Papua.

The company, whose oil production is around 119,000 barrels per day, is targeting to produce 128,000 barrels of oil per day (bopd) this year and 1,071 million standard cubic feet of gas per day. The company’s oil production was 120,600 bopd last year, lower than its target of 123,600 bopd.

“For gas, we are currently almost at 100 percent of the target,” Satoto said, adding that the firm might change its target pending the production level in the first half.

In the state budget, national oil production is targeted to reach 870,000 barrels per day.

But contractors could only propose a combined production of 804,000 bopd, according to figures from Upstream Oil and Gas Regulatory Task Force (SKKMigas), prompting the government to consider a revision to 820,000 bopd.

Meanwhile, Pertamina Geothermal Energy president director Rony Gunawan said the eight geothermal power plant projects, which included drilling activities and infrastructure development, were located in Kamojang and Kraha in West Java; Ulubelu in Lampung; Sibayak in Brastagi, North Sumatra; Lumut Balai in Muara Enim, South Sumatra; Hulu Lais in Bengkulu; Kotamobagu in North Sulawesi; and Sungai Penuh in Jambi.

“The 35-megawatt [MW] Kamojang Power Plant Unit V is still under construction, while the Ulubelu and Kraha power plants are expected to be operational in 2016,” Rony said in Bandung on Wednesday, adding his firm targeted to produce 80 MW of electricity by 2018.

The company spent $150 million in capex in 2012, while it faced a hurdle last year in its project in Bolang Mongondow, North Sulawesi, because of its proximity to a protected forest, resulting in an extra mile between the project site and the geothermal source, said Rony.

The Geothermal Law classifies geothermal field developments as mining activities, meaning development of geothermal fields in forest conservation areas violates the Forestry Law.

 

http://www.thejakartapost.com/news/2014/03/07/pertamina-s-subsidiaries-spend-millions.html

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About artidj

I started working as a field engineer in Oil & Gas industry back in 1996. I do this news clipping of the industry and the geography I am interested in, mainly for my own information. I'm glad you find it useful.
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