Cepu crude to be heavy, sour

Cepu crude to be heavy, sour

SINGAPORE (Dow Jones): Exxon Mobil Corp. Friday said it will produce sour crude oil from its Banyu Urip field, in the Cepu technical assistance contract in East Java, in the first significant sour crude production from Indonesia.

The crude will be waxy sour crude, with an API of 32, said Julia Tumengkol, spokeswoman for ExxonMobil Oil Indonesia Inc.

API is a measurement of the weight of crude oils, whereby a relatively low API indicates a heavy crude and a high API indicates a lighter grade. 34 API is the midpoint of the range of crude grades.

Exxon Mobil plans to begin production from the Cepu block at 25,000 barrels a day in 2003, ramping up to 100,000 barrels per day by 2004, Tumengkol said.

Exxon Mobil is still in negotiations with Indonesia oil company Pertamina over terms for developing the Cepu block. Exxon Mobil wants to extend the expiry date of the technical assistance contract, and Pertamina wants more than a 10 percent stake in the block, an industry source said.