ExxonMobil Oil to resume its operation Friday

JAKARTA (JP): State-owned oil and gas company Pertamina said on Wednesday ExxonMobil Oil Indonesia, a unit of the U.S.-based Exxon Mobil Corp., would resume its operations at the Arun gas fields in Aceh on Friday, four months after the company was forced to turn off its gas taps due to increasing security threats.

Iin Arifin Takhyan, Pertamina's director for upstream operations, said preparatory work for the resumption of operations were nearly complete.

"ExxonMobil is still conducting some tests to see whether or not the wells still work properly. We expect the company to restart its operation in the next two days," Iin said.

He made these comments following the presentation of an ISO 14001 certificate by German certification agency TUV Indonesia to Pertamina, for environmental management at its lube blending plant in Cilacap, Central Java.

Also present at the ceremony was TUV Indonesia president Markus Hattemer.

The timetable given by Iin was the most specific since ExxonMobil halted the operation of its Arun gas fields in March.

However, ExxonMobil spokesperson Julia Tumengkol declined to confirm Iin's statement.

"We cannot give any confirmation as our preparatory work is still underway. The problem is that we are evaluating the preparatory work on a daily basis," she told The Jakarta Post.

ExxonMobil has never give a definite timetable on when it will resume its operation. It hinted last Saturday that the resumption of operations would take place within weeks.

Iin said after ExxonMobil resumed operations at its gas fields, the production of liquefied natural gas (LNG) at the nearby PT Arun NGL would gradually resume. Arun NGL, which relies on ExxonMobil for gas supplies, halted its LNG production soon after ExxonMobil halted its gas production.

He said ExxonMobil would initially resume operations at two clusters, before including the other two clusters to reach a normal level of production.

ExxonMobil groups its gas wells in the area in four clusters. The company was producing an average of 1.6 billion cubic feet of gas and 30,000 barrels of condensate daily before it suspended operations.

Indonesia has insisted ExxonMobil restart its Aceh operations promptly because LNG demand in North Asia is expected to peak in the summer, and production at Pertamina's other LNG center in Bontang, East Kalimantan, will be insufficient to meet all of Pertamina's LNG supply commitments.

Following the shutdown of Arun NGL's LNG plant, Pertamina transferred the plant's LNG orders, mostly from Japanese and South Korean buyers, to the Bontang LNG plant.

But Pertamina president Baihaki Hakim said earlier the Bontang LNG plant could only guarantee supplies to the buyers until the end of June.

Beyond June, he said, the Bontang LNG plant would no longer have excess supplies due to an increase in demand from its customers.

Indonesia lost US$10 million a month from March to May as a result of the halt of ExxonMobil's gas operations, according to Pertamina.

Regarding the awarding of the ISO certificate, Iin said such certificates would be crucial in the near future as consumers required good quality and environmentally friendly products.

"They (businesspeople) must seek certification for their products if they want to survive the stiff competition of the coming free trade era," Iin said.

"We hope the presentation of the ISO 14001 certificate will prompt other lube plants across the country to earn certification." (03/bkm)