Oil production in Riau down by 10 percent annually

Puji Santoso, The Jakarta Post, Pekanbaru

PT Caltex Pacific Indonesia, the country's largest oil producer situated in Riau province, is facing a sharp decrease in production by around 10 percent annually due to the reducing oil reserves in its aging wells.

The company's president director, Wahyudi Yudiana Ardiwinata, said Caltex was struggling to maintain its production level.

"It is not possible for us to increase production. But we can try to keep the decrease at between 3 percent and 5 percent," he said on Friday after awarding scholarships to high school students in the city.

At present, Caltex produces 500,000 to 520,000 barrels per day (bpd) of crude oil from its wells across Riau province.

Caltex is the largest oil producer in Indonesia with production across the country reaching 499 million bpd in 2004.

The country's oil production has decreased over the past decade due to the aging field and lack of new oil exploration nationwide. Due to the decreasing production, the country is considering resigning from the Organization of Petroleum Exporting Countries (OPEC).

Wahyudi further said that to explore some existing wells the company would need more investment.

"Exploration costs are too high compared to the remaining oil reserves," he said.