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The country's largest publicly traded oil company PT Medco
Energi Internasional said over the weekend it plans to spend US$500
million to develop Blok A in Aceh.
The company's aim is to start operations and production by 2010.
Medco president director Lukman Mahfoedz said Medco was in the process
of submitting for approval its plan of development (POD) to the
Upstream Oil and Gas Regulatory Agency (BPMigas), as required under
existing regulations.
Lukman said Medco would share costs with its partners Premier Oil
Sumatra and Japan Petroleum Exploration.
"We have given the POD to our partners," he said, without elaborating.
Medco and Premier hold the majority stake in Blok A, with 41.67 percent
and 41.66 percent respectively.
Japex holds the remaining 16.67 percent.
A Medco-led consortium bought at the end of January a 50 percent stake
in Blok A from ConocoPhillips, the third largest U.S. oil company.
In April 2006, Medco and partners purchased the first 50 percent stake
in the blok from U.S. energy giant ExxonMobil.
The gas blok was previously owned by Conoco and Exxon, with a
participating interest of 50 percent each.
ConocoPhillips and ExxonMobil said they sold their stake because of the
high content of carbon dioxide in the block, which makes gas
exploration and production more expensive.
The block is reported to have a proven reserve of 0.5 trillion cubic
feet.
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