Disputes cause drop in Caltex oil production

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)