RI asks Santos to speed up exploration to boost output

RI asks Santos to speed up exploration to boost output

Bloomberg, Jakarta

Indonesian government asked Santos Ltd., Australia's third- largest oil and gas producer, to speed up exploration at the Jeruk field off East Java because the country needs to increase its oil output to stay a net exporter.

Indonesia expects an additional 150,000 barrels a day from Jeruk field when it is fully developed, Minister of Energy and Mineral Resources Purnomo Yusgiantoro said on Monday. That volume will help Indonesia cut crude oil imports and maintain exports, he said. "We've asked Santos to drill more wells this year."

The Jeruk discovery may be Santos's largest ever oil find, the company said on Jan. 20. Jeruk holds more oil than Santos's original estimate of 170 million barrels, which was made before any wells had been drilled at the field.

Indonesia expects output at Jeruk as early as 2008, Kardaya Warnika, vice chairman of the state oil upstream regulatory agency (BP Migas) said.

The country plans to boost oil production to 1.3 million barrels by 2008, BP Migas chairman Rachmat Sudibyo last week. It expects additional production from Jeruk, Cepu field in Central Java, several marginal fields and oil recovery efforts at ChevronTexaco Corp.'s fields in Sumatra.

In February, Purnomo said the country may quit the Organization of Petroleum Exporting Countries as falling crude oil production strains its ability to maintain exports.

Indonesia's oil output has fallen 5 percent annually during the last five years. It produced 1.05 million barrels a day of crude oil and condensates last year. For four months of last year the country had to import supplies to meet demand.