Lapindo Brantas spillover Energy-Bumi merger
Minister for environmental affairs Rachmat Witoelar threathened to terminate the operation of Lapindo Brantas in East Java for its failure to apply prudent operating measures that led to massive pollution from an East Java gas well.
Blame games at play, as usual. Lapindo's shareholder PT Medco E & P Brantas, a unit of the listed PT Medco Energi Internasional Tbk, said in a letter to Lapindo that it had reminded the firm on May 18 to set casing at a depth of 8,500 feet, as agreed in the drilling program, The Jakarta Post wrote today.
Lapindo Brantas Inc is a subsidiary of listed PT Energi Mega Persada Tbk (closely linked to Bakrie Family). This company is the designated operator of the Brantas PSC and it owns a 50% participating interest. Other shareholders at Brantas PSC are Medco (32%) and Australian Santos (18%).
Having purchased its participating interest in the mid-1990's, EMP built the Brantas PSC to be the single largest supplier of gas to the East Java PGN distribution network by 2004 from the Wunut Field.
According to Energi's annual report 2005, last year Brantas PSC produced average of 51 MMSCFD of natural gas and 14 barrel oil per day, almost half of Energi's total gas production.
Brantas PSC has up to 7 oil and gas prospects with contingent resources of up to 66 bcf under a contract mature in 2020. With prospective oil reserves of 244 million barrel and 1.35 BCF of natural gas, Brantas PSC is one of EMP's important source of income.
Oil production from the discovery in Tanggulangin field at Brantas PSC is expected to reach over 3,000 bopd by 2007.
With such significance, the question is whether Witoelar is serious enough to close down Lapindo Brantas operation. But as quoted by The Jakarta Post, Witoelar said his ministry has no authority to order Lapindo to halt its operations, asides from giving a recommendation to do so to the Energy and Mineral Resources Ministry and the Oil and Gas Regulatory Body (BP Migas) which issued the exploration license.
Closing down the company's operation may create another problem, gas scarcity for electricity generating company PLN. Punishments should be strong enough to push this company implement stringent measures in its future operation.
Whatever the government decision might be, the catastrophe potentially will influence the planned merger of Energi with PT Bumi Resources Tbk. The rehabilitation might take few months and not to mention potential litigation toward the company.
READ MORE!!!
Blame games at play, as usual. Lapindo's shareholder PT Medco E & P Brantas, a unit of the listed PT Medco Energi Internasional Tbk, said in a letter to Lapindo that it had reminded the firm on May 18 to set casing at a depth of 8,500 feet, as agreed in the drilling program, The Jakarta Post wrote today.
Lapindo Brantas Inc is a subsidiary of listed PT Energi Mega Persada Tbk (closely linked to Bakrie Family). This company is the designated operator of the Brantas PSC and it owns a 50% participating interest. Other shareholders at Brantas PSC are Medco (32%) and Australian Santos (18%).
Having purchased its participating interest in the mid-1990's, EMP built the Brantas PSC to be the single largest supplier of gas to the East Java PGN distribution network by 2004 from the Wunut Field.
According to Energi's annual report 2005, last year Brantas PSC produced average of 51 MMSCFD of natural gas and 14 barrel oil per day, almost half of Energi's total gas production.
Brantas PSC has up to 7 oil and gas prospects with contingent resources of up to 66 bcf under a contract mature in 2020. With prospective oil reserves of 244 million barrel and 1.35 BCF of natural gas, Brantas PSC is one of EMP's important source of income.
Oil production from the discovery in Tanggulangin field at Brantas PSC is expected to reach over 3,000 bopd by 2007.
With such significance, the question is whether Witoelar is serious enough to close down Lapindo Brantas operation. But as quoted by The Jakarta Post, Witoelar said his ministry has no authority to order Lapindo to halt its operations, asides from giving a recommendation to do so to the Energy and Mineral Resources Ministry and the Oil and Gas Regulatory Body (BP Migas) which issued the exploration license.
Closing down the company's operation may create another problem, gas scarcity for electricity generating company PLN. Punishments should be strong enough to push this company implement stringent measures in its future operation.
Whatever the government decision might be, the catastrophe potentially will influence the planned merger of Energi with PT Bumi Resources Tbk. The rehabilitation might take few months and not to mention potential litigation toward the company.
Labels: Bakrie, BP Migas, Bumi Resources, Electricity, Energi Mega Persada, Lapindo, Medco, PGN, PLN
READ MORE!!!
posted by yosef at 12:20 PM
2 Comments:
In these cases ultimate responsibilty falls with the CEO,Managing Director and the Board of the Operating Company.It should not affect production from the operators (Lapindo) assets. Question is did the Operator take undue risks as some comments suggest? If so they should be fined (personally) or locked up.
Who will conduct an inquiry and who will be involved? Independent Oil and Gas experts should be able to get to the truth. Some of the lies that Lapindo were talking about early on (the effect of the earthquake) are not a indication of their honesty.
My company has a permanent solution to stop the mudflow and reduce the environmental disaster that may ensue. Will any interested party please contact me on any of the contacts below. My project team has a meeting in Singapore Wednesday through to Saturday but will be in Jakarta on Sunday onwards for meetings. Contact details are: UK cell: +44 7785 365604 Indo cell: +62 817 007 6897 Fax2Email: +44 870 706 2146 (you fax to this number and it gets emailed to me) or email mail@mckmid.com
Post a Comment
<< Home