Friday, March 30, 2012

Medco, partners to acquire two ExxonMobil’s gas blocks

Medco, partners to acquire two ExxonMobil’s gas blocks
The Jakarta Post | Fri, 03/30/2012 10:27 AM
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PT Medco Energi Internasional says it will join forces with two other firms to buy two oil and gas blocks operated by US-based ExxonMobil.

Medco, state gas distributor PT PGN and state fertilizer maker PT Pupuk Sriwijaya (Pusri) have submitted a formal bid for ExxonMobil’s Block B and the North Sumatra Offshore (NSO) block, Medco president director Lukman Mahfoedz said in a message on Thursday.

“If the acquisition is successful, the share composition for the two blocks will be 40 percent for Medco and 30 percent for PGN and Pusri, respectively,” he said.

Contacted separately, ExxonMobil declined to name of companies interested in its 100 percent stake in both blocks or its 30 percent stake in liquefied natural gas producer PT Arun NGL.

The assets produced a combined 215 million standard cubic feet of gas per day (mmscfd) in 2010, ExxonMobil said in a statement sent to The Jakarta Post in August last year.

“We can’t comment further because the [acquisition] is still underway. We will ensure that the decision to sell the shares is consistent with the company’s long-standing practice of continuously reviewing assets for their contribution to the company’s operating and financial objectives,” the company said in the statement.

ExxonMobil is now concentrating its attention on developing the Cepu block in East Java.

Cepu’s Banyu Urip field will produce 165,000 barrels of oil per day (bpd) by 2014 and may be one of the most important blocks in Indonesia’s effort to produce 1 million bpd of oil by that year, according to reports.

ExxonMobil has been operating in Indonesia for more than 100 years. Its current projects cover the Cepu block in Central Java, East Natuna in Riau Islands and the coal bed methane (CBM) evaluation project in Kalimantan.

Gas in Aceh was discovered by Mobil Oil Indonesia in 1971. After studies, the government and its partners set up an LNG plant in Arun and began exporting LNG to Japan in 1978.

State oil and gas firm PT Pertamina currently holds a 55 percent stake in the Arun LNG plant, ExxonMobil owns 30 percent and a consortium of Japanese buyers owns 15 percent.

According to upstream oil and gas regulator BPMigas’s data, the Arun LNG plant exported 362 cargoes of LNG in 2011, down significantly from 427 cargoes in 2010.

— JP/Rangga D. Fadillah

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