Balikpapan offshore oil rig explodes

BALIKPAPAN, East Kalimantan (JP): An off-shore oil rig owned by Unocal Indonesia Co. exploded here after a fire razed it at dawn on Sunday, but no fatalities were reported.

The company's general manager, Muchlis Sadzali, said gas leaking from a neighboring old oil-well had caused the explosion.

He said the well, which had been bored to 400 meters below sea level, might have contained more oil reserves than expected.

"Gas leaks are a natural cause of fires in off-shore oil exploration. It's a force majeur," he said.

The cost to the company, a contractor of the state-owned oil firm Pertamina, of losing the rig was estimated at between Rp 18 billion (US$6.6 million) and $42 billion, according to Muchlis.

He said the oil rig had so far drilled Rp 500 million worth of oil.

Company workers overlaid the leaking well with mud to stop the fire.

The company temporarily ceased oil exploration and evacuated all workers and tankers from the remnants of the rig, according to Muchlis.

A Pertamina official confirmed the accident yesterday. She said none of the 20 people working at site were hurt.

"They were evacuated when the fire gutted the oil rig," she said on condition of anonymity.

She said the accident would not pollute of the sea due to an the presence of an in-built antipollution device.

Pertamina is expected to explain the accident today, she said. (42/jsk)