Medco records 43.2% rise in net income on surge in oil prices

The Jakarta Post, Jakarta

The country's biggest upstream oil and gas exploration company PT Medco Energi Internasional reported a 43.2 percent increase in net income in the first nine months of the year to US$68.44 million, up from $47.78 million in the corresponding period last year.

In a release disseminated to the press over the weekend, the company said net revenues also soared by 12.7 percent to $442.21 million during the first three quarters, compared to $392.55 million in the same period in 2004, due to the increase in global crude oil prices, profits from joint ventures and revenues from other contracts.

The company, however, also reported a decline in oil exploration and production, as well as in natural gas sales.

Average daily oil output declined to 54,600 barrels per day (bpd) in the first nine month of the year from 57,290 bpd in the same period last year.

Meanwhile, the company's natural gas sales over the first nine months dropped by 33.9 percent to 135.8 million cubic feet per day (mmcfd), compared to 205.5 mmcfd during the same period last year.

Medco did not give any reasons for the decreases in oil production and gas sales.

Medco's cost of sales in the first nine months also decreased by 11.9 percent to $193.84 million from $219.9 million in the corresponding period last year due to lower exploration expenses as well as depreciation and amortization expenses for oil and gas assets due to the sales of ex-Novus assets and the Asahan block.

The company said that its main objective for the rest of the year would be to add to reserves and production through the exploration and development of recently acquired blocks.

On Oct. 5, the company, through its wholly owned subsidiary Medco Far East Limited, acquired 100 percent of the shares of Perkasa Equatorial Sembakung Ltd in East Kalimantan. The Sembakung block had proven oil reserves of 12.6 million barrels as of January 2005.