BP to sell gas blocks to Petronas and EMP<\/p>\n
Fitri Wulandari, The Jakarta Post, Jakarta<\/p>\n
British energy giant BP Plc expects to wrap up deals to sell
\ntwo gas blocks to local firm PT Energy Mega Persada (EMP) and
\nMalaysia's Petroliam National Bhd. (Petrona) later this month,
\nthe company said on Thursday.<\/p>\n
President of BP Indonesia Bill Schrader said the company would
\nsell its Kangean block in East Java to EMP, and the Muriah block
\noff the coast of Central Java to Petronas.<\/p>\n
"We reached an agreement to sell them. We are in the process
\nof closing the deals with the target of closing by the end of the
\nmonth," Schrader said in Denpasar.<\/p>\n
He declined to disclose the value of the transactions.<\/p>\n
The company is selling the blocks because it wants to focus on
\nlarger projects such as the Tangguh liquefied natural gas (LNG)
\nplant project in Papua.<\/p>\n
"BP's strategy on exploration are to go after much bigger
\nopportunities like Tangguh. We really want to focus on getting
\nthe Tangguh project launched and finding customers," Schrader
\nsaid.<\/p>\n
BP inked an LNG deal worth US$2 billion with South Korean
\nsteel maker Posco on Thursday. Under the sales and purchase
\nagreement, BP will supply 550,000 tons of the fuel for 20 years
\nto Posco from its Tangguh LNG plant starting in 2005.<\/p>\n
The company is also seeking to finalize LNG contracts with
\nSouth Korean power company K Power, formerly known as SK Corp.,
\nand U.S. energy firm Sempra Energy.<\/p>\n
The contract on the Kangean block ends in 2010 and BP had been
\nlobbying the government to extend the contract, but the
\ngovernment has yet to give its final approval.<\/p>\n
Schrader said EMP, as the new owner, was now responsible for
\ngetting the contract extended.<\/p>\n
"EMP will continue the process we have started of trying to
\nget an extension so that it can get to Terang Sirasun field and
\ndevelop more natural gas in East Java," he said.<\/p>\n
A contract extension would allow EMP to explore and develop
\nthe Terang Sirasun field, which is thought to have huge gas
\ndeposits and could help ease the current natural gas shortages in
\nEast Java.<\/p>\n
BP has operated the Kangean block since 1980. Production
\nstarted in 1994 with the Pagerungan gas field. According to the
\nOil and Gas Upstream Regulatory Body, Pagerungan supplies between
\n150 million and 175 million standard cubic feet of gas.<\/p>\n
The company acquired Muriah from Shell in 1991 and carried out
\ninitial explorations in 1997. The contract to operate Muriah
\nexpires in 2021.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bp-to-sell-gas-blocks-to-petronas-and-emp-1447893297",
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"sponsor": "Okusi Associates",
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