Medco deals with energy business, environment and community

Medco deals with energy business, environment and community

As a company dealing in the energy business, PT Medco Energi
Internasional has shown a deep concern for the environment and
the community.

Medco realizes that its line of business has a direct impact
on the environment and the communities around its projects. That
is why since the company has taken a special interest in their
preservation since the very beginning.

Medco is an Indonesia-based integrated energy company dealing
with oil and gas exploration and production; onshore and offshore
drilling services; downstream industries in petrochemicals; and
distribution. Medco comprises a number of subsidiaries and
affiliated firms.

Company President John S. Karamoy said that Medco had always
set measures to answer various community and environment issues.

He said that preventive measures were planned to find
several environmental problems, such as noise disruption caused
by compressor operations and increased temperature from flare
pits.

In terms of community assistance, Medco has been also involved
in various community development programs, he added.

This includes the development of clinics, schools and jobs for
local people, which have a direct impact on the economy of the
surrounding areas, he said.

Environment

According to Karamoy, Medco has a corporate safety and
environment policy which requires every corporate individual to
prioritize safety and to be aware of safeguarding the environment
and consciously carry out a safe working environment.

"The company has a Safety and Environment department, where
familiarization of safe working practices are passed on to the
company's work forces, in addition to environmentally friendly
practices," he said.

To avoid pollution, produced formation water is reinjected
back into the original formation, which resulted in zero water
discharge of the company's operations.

"So far, this is done in the project in Sumatra. We expect to
see the same level of zero discharge in Kalimantan operations by
next year," Karamoy said.

He said that Medco currently planned to utilize produced gas
which is, at present, flared. The company also conducted studies
to reinject the gas. For its LPG plant, the company also planned
to market gas produced to local buyers, which was currently under
negotiations with Pertamina.

Karamoy said that in terms of noise pollution, most of Medco's
operations are located far from residential areas, therefore, the
noise disruption caused by compressor operations and increased
temperature from flare pits would not affect residents.

Environmental and safety concerns are prime elements of
standard operational procedures. Each of Medco's subsidiaries has
to conduct activities without damaging the physical and social
environment.

For instance, at Exspan, one of Medco's subsidiaries, the
health and safety record is considered exemplary.

Community development

Medco, the largest national private oil and gas company, is
actively involved in community development programs.

As a member of the industrial community which takes
responsibility in the neighboring environment, Medco has promoted
a caring attitude toward local problems, which is demonstrated by
the involvement of the company in providing donations as part of
the community development programs.

In general, the assistance includes four items: environment,
education, welfare and emergency situation.

For example, Exspan, which operates projects in Riau and East
Kalimantan, has established rice fields to provide a meaningful
effect in solving food supply problems. Exspan has also
introduced permanent agriculture technics to local farmers in an
attempt to reduce and eliminate the practice of slash-and-burn
methods.

According to Karamoy, Medco has also supported various social
services, including the development of a road linking Tanjung
Lubuk to Pendopo, and the maintenance of roads, religious centers
and schools. There are also other programs on clean water
projects and training on agribusiness.

In addition, Medco provides scholarships to hundreds of
students to study at public universities in Palembang, Riau,
Balikpapan, Bandung and Yogyakarta. There are also annual
scholarships for elementary school and junior high-school
students.

History

Medco was initiated as a company called PT Meta Epsi Pribumi
Drilling Company, which was established in June 1980 to engage in
onshore contract drilling services across Indonesia. The company
launched an Initial Public Offering in October 1994 to become the
first energy company listed at the Jakarta Stock Exchange.

Medco's major business lines include oil and gas exploration
and production; onshore and offshore drilling services; and
methanol production.

Medco operates 12 exploration and production working areas,
comprising three types consisting of Production Sharing Contract
(PSC), Technical Assistance Contract (TAC) and Joint Operating
Body (JOB).

The company booked Rp 530 billion in net profits in the third
quarter of this year, almost twice the Rp 282 billion recorded
during the same period last year.

As a publicly listed company, Medco is committed to complying
with all relevant regulations and requirements. The company's
goal is to maintain the highest ethical standards possible from
the standpoint of an industry society as a whole.