Disputes cause drop in Caltex oil production

JAKARTA (JP): Continued disputes with locals have caused crude oil output of the country's largest oil producer PT Caltex Pacific Indonesia in Riau province to drop by an average of 30,000 barrels of oil per day (bpd), the company said on Monday.

Caltex president Humayunbosha blamed the production decline on disturbances, such as blockades, hostage-takings and the arson of equipment and vehicles.

"The loss in production occurred in oil fields in Rumbai with 2,600 bpd; in Duri with 10,800 bpd; in Minas with 2,500 bpd; and in Bekasap with 12,900 bpd," Humayunbosha said in his written response to House of Representatives Commission VIII for environmental, science and technology affairs. Caltex's current oil output is 690,000 bpd.

Last week, a group of farmers set fire to four of Caltex's oil wells in the Bengkalis regency, which temporarily halted production.

Earlier this month, some people seeking jobs at Caltex blockaded several of the company's oil rigs after their appeal was rejected.

The incident prompted a production loss of between 15,000 bpd and 20,000 bpd.

Renville Almatsier, a spokesman at Caltex, said the loss of 30,000 bpd did not include the drop from marginal oil fields, where reserves were nearing their end.

He said during its peak production level, the company was able to extract 740,000 bpd of oil.

He said disturbances in Caltex's production began in 1999, but the unrest had started in 1998 after the downfall of former president Soeharto.

The end of Soeharto's authoritarian rule prompted widespread conflict between locals and mining firms operating in the region.

Humayunbosha said his company was working closely with the local authorities to settle disputes with locals.

Caltex, a joint venture between U.S. oil companies Chevron Corp. and Texaco Inc., currently operates four oil blocks in Riau: the Coastal Plan Pekanbaru (CPP), Rokan, Mount Front Kuantan and Siak.

As the largest oil producer, Caltex is the main contributor to Indonesia's crude oil export revenue.

The country is pushing to meet its new export quota of over 1.317 million bpd as set by the Organization of Petroleum Exporting Countries (OPEC).

But even without the unrest, the country can hardly raise its oil output as most companies were already pumping oil to their full capacity.

State-owned oil and gas company Pertamina said it might take until the first half of next year before Indonesia can meet its new quota. (bkm/tnt)