27 oil exploration areas on offer this year
27 oil exploration areas on offer this year
JAKARTA (JP): State oil and gas company Pertamina is offering
27 areas for oil and gas exploration this year, including 15 in
eastern Indonesia, the company's director for exploration and
production, Prijambodo Muljosudirdjo, said yesterday.
He said 23 of the areas were being offered under the
production sharing contract (PSC) and four under the technical
assistance contract (TAC).
"Eighteen of the areas are subject to direct negotiations with
Pertamina and the other nine will be awarded through competitive
bidding," Prijambodo said.
He said he was optimistic oil exploration activities would
increase this year.
"Last year, oil contractors spent only US$586.7 million on
exploration. This year they are committed to spending more than
$1 billion," he said.
He said total spending by foreign oil contractors on
exploration, production development and administration would
reach $5.34 billion this year, up from $4.21 billion last year.
He said exploring for oil in eastern Indonesia was more
expensive than in western areas because of inadequate
infrastructure and the remoteness of exploration areas.
"But I think the incentives we are offering are attractive
enough to the contractors," he said.
Pertamina was offering case-by-case incentives to oil
contractors in remote areas, he said.
In addition Pertamina was offering a production sharing scheme
of 65:35 in frontier areas compared to the normal 85:15 split in
other areas. The splits are in Pertamina's favor.
He said 16 wells were drilled last year in eastern Indonesia
compared to five wells in 1995.
In the western parts, 84 wells were drilled last year compared
to 70 in 1995.
Prijambodo said he expected between 10 to 15 oil contracts
would be signed this year, as against 15 contracts consisting of
nine PSCs and six TACs last year.
Last year's 15 contracts were awarded to Asamera in South
Sumatra, Canadian Oxy in Maluku, Caltex Pacific Indonesia in
North Sumatra, Eurafrep Resources in East Java, Garis Asta
Tunggal in East Kalimantan, Gunakarsa in North Sumatra, Indospec
in West Java, Opic in Aceh, Pilona in South Sumatra, Premier in
East Java, Ranya Energy in West Java, Risyad Salim Resources in
North Sumatra, Santa Fe in Irian Jaya and East Kalimantan, and
Western Nusantara in South Sumatra.
Prijambodo said Pertamina expected to sign several oil
contracts soon. "We have finalized negotiations with seven oil
contractors for exploratory concessions in East Java, North
Sumatra, Jambi, Riau, East Kalimantan and Southeast Timor," he
said.
Pertamina is also negotiating eight contracts with oil
companies and will soon start negotiating another eight, he said.
"We will continue encouraging explorations to increase proven
oil reserves in order to sustain oil production," Prijambodo
said.
Indonesia produced 1.57 million barrels of crude oil and
condensate a day last year, compared with 1.59 million barrels in
1995. (bnt)