Cooper awarded Indonesian oil fields

Cooper Energy Ltd (Australia) has been awarded a contract by state oil and gas company PT Pertamina to operate and develop the Sukananti, Tangai, and Bunian oil fields (Sukananti KSO) in South Sumatra.
The Sukananti KSO is located in South Sumatra, Indonesia, on trend with the Limau and Tanjung oil fields. The Bunian oil field is currently producing at 60 barrels of oil per day through a single well. The Tengai oil field was producing through four wells and the Sukananti oil field was producing through a single well but these are now shut-in, awaiting wellbore remediation and workover.
The three oil fields in the Sukananti KSO have produced 1.08 million barrels of oil to date. Cooper is looking forward to more fully developing the oil fields and recovering an additional 1 million barrels (P50) of oil.
Cooper's program consits of a signature bonus of US$861,888m 24 Km2 of 3D seismic, a new development well, 3 well workovers and infrastructure updates with total cost over three years of around US$6.8 million. Cooper's JV partner (10% interest) in the project is PT Mega Adhyaksa Pratama.

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Energi Mega Reports Gas Flow Incident

Oil and gas company PT Energi Mega Persada Tbk (ENRG) said in a filing to the Indonesian Stock Exchange that there was a gas flow incident occurred at the company’s oil and gas field Bentu PSC, Segat-2, in Riau, Sumatra.

The incident occurred during well work-over activities, which has led to an evacuation of the non-essential site workers.

Nevertheless, there were no casualties or property damage during the incident. It added the incident as no impact on the Bentu and Korinci Baru PSCs. The original Segat-2 discovery well was drilled back in 1995.

Hopefully there will be no more mudflow like the one in Sidoarjo (Lapindo). Energi Mega was the controlling owner of Lapindo, which drilled the oil and gas field in Sidoarjo. Partners in Lapindo were Medco and Santos. (Roffie Kurniawan)

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Elnusa Secures US$20 Mln Oilfield Service Contract

Oil and gas service company PT Elnusa (ELSA) Tbk, a unit of Pertamina said it has secured oilfield maintenance service contract worth US$20 million. The projects will be located in Java and East Kalimantan.

In the first two months of this year, Elnusa already secured oilfield service contract worth US$55.19 million.

It said it will use hydraulic work-over, snubbing and well testing barge in taking care of the oilfields. It said at present, the company’s oilfield service division is also finalizing work-over projects, snubbing and well testing barge in East Kalimatnan worth US$28.92 million. In addition, it is also working on ongoing maintenance service project for a pipeline and production facilities in Java and Sumatra worth US$6.27 million.

Heru Samodra, VP corporate secretary of Elnusa said, “To strengthen our core business in providing integrated service to oil-gas upstream sector and maintain business growth, Elnusa has set aside capex (capital expenditure) of US$70 million this year. The fund will come from internal cash-flow.”

Elnusa engages in providing integrated geosciences services, drilling services and oil-field services. The company targets to post revenues of Rp 4.46 trillion this year, up 29 percent from last year. Pertamina holds 41.1% stake in Elnusa. In February this year, PT Benakat Petroleum Energy bought 37.2 percent stake in the company from PT Triday Esta. The remainder shares are held by the public.

Elnusa closed at Rp330 today. At that price, Elnusa has market capitalization of Rp2.41 trillion or about US$260 million. (Roffie Kurniawan)

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Pertamina acquires 15% Semai II Block

State-owned oil and gas firm PT Pertamina has reached an agreement with a consortium of Murphy Semai Oil Co. Ltd., PTT EP Semai II Ltd, and Inpex Seram Sea Ltd to acquire 15% of participation interest in Block Semai II, offshore West Papua. The acquisition is pending government approval.

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Pertamina-PetroChina Cuts Output To Meet Gas Flare Rule

The oil production of the joint operating body (JOB) Pertamina-PetroChina East Java has been reduced by 3,000 barrels of oil per day in order to meet the gas flare target of a maximum of 14 million cubic feet per day, in line with the Law on Environment, said Chairman of the upstream oil and gas regulatory body BPMigas Raden Priyono Monday.

He however did not disclose the current production level of the JOB. But, on February 24, President Director of PT Pertamina EP Cepu, Haposan Napitupulu said as of the date, the JOB Pertamina-PetroChina has slashed oil production to 41,000 bopd from its capacity (normal production) of 48,500 bpd.

The oil produciton of the Kangean field has also been reduced by up to 2,500 bpd as it only produced water. Oil production of the Kodeco oil field has also been reduced by 4,000 bpd.

Pertamina also said it is expanding its overseas market for its downstream oil products, including aviation fuel (Avtur) and oil fuel. The company is planning to open gas stations in Malaysia and Australia, said Pertamina Marketing and Commercial Director, Djaelani Sutomo.

Priyono also said that the average oil production in the first two months of this year has reached 951,000 bpd, far below the 2010 State Budget assumption of 965,000 bpd. Average production in February alone was quite encouraging, at 959,000 bpd, just below the State Budget target. (Ferdy Hasiman)

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PGN Seeking New Gas Source for Jakarta , Banten Customers

The country’s largest gas distributor PT Perusahaan Gas Negara Tbk (PGN) said that it is currently seeking gas sources to be distributed to its industry customers in Jakarta and Banten after gas received from a unit of Pertamina stopped on Februady 28, as gas sales and purchase contract expired on the day.

Under gas sales and supply contract signed on January 10, 1998 , which was amended on December 16, 2009 , PT Pertamina Hulu Energi (PHE), a unit of state-owned oil and gas company PT Pertamina, distributed up to 1.8 TBTU (trillion british thermal unit) of gas through its ONWJ gas pipeline. As the gas volume has been reached on February 28, the gas supply was then stopped.

The gas supply from ONWJ gas pipeline has been distributed by PGN to 150 industry subscribers in Jakarta and Banten area.

“Considering the impact (of the cease of gas supply) on industry activities in those areas, PGN is weighing a number of options in order to continue gas flow, including options that are being studied jointly with PHE and (upstream oil and gas regulator) BPMigas,” PGN said in a filing to the Indonesian Stock Exchange. PGN however did not disclose a number of options nor impact on its industrial customers before it would get new gas supply. (Roffie Kurniawan)

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Medco Signs MoU with Libya over Area 47 Block

Oil and gas company PT Medco Energi Internasional Tbk, found by businessman Arifin Panigoro, said its wholly owned unit Medco International Ventures (MIV) has signed a memorandum of understanding with Libya Investment Authority (LIA) over the development of lucrative onshore Area 47 oil and gas block in Libya.

LIA, a sovereign wealth funds of Libya, is a new partner of Medco in developing the Area 47 block. On December 21, 2009, LIA has finalized the acquisition of 100% shares in Verenex Energy Inc. (verenex), a listed oil and gas and company in Canada, which holds 100% shares in Verenex Energy Area 47 Ltd (VEAL). VEAL is the partner of Medco International, which holds 50% interest in the Area 47 and also the operator of the block.

Under the MoU, both parties agreed that the operator of the Area 47 block will still be in the hands of VEAL, which is now a subsidiary of LIA, while Medco International Ventures will be responsible to provide services and support on technical and operational aspects to Verenex Energy.

MIV is fully owned by Medco Energi Global Pte Ltd, a sub-holding which is also a wholly owned subsidiary of Medco Energi. MIV holds 50% interest in the oil and gas exploration block, in area 47, located in Ghadames Basin, Libya.

Medco Energi said that both LIA and MIV will cooperate to secure approval on Working Program and Budget for 2010 from the Lybian government as well as securing extension of exploration extension and the re-implementing drilling program in the Area 47.

Medco Energi and Verenex won the rights to develop the block for 30 years in 2005. Under the deal with the Libyan government, Medco and the Libyan sovereign wealth fund will receive 13.7 percent of revenue and the Libyan government 86.3 percent. The block, which is believed to contain about 2.15 billion barrels of oil equivalent, is expected to begin production in 2013-2014. (Roffie Kurniawan)

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Tap Oil Secures Govt Approval to buy 24% Rangkas Block

Tap Energy (Rangkas) Ltd, a subsidiary of Australian Tap Oil Ltd, said on Tuesday that it has secured the necessary approval from the Indonesian government to acquire 24% interest in the Rangkas Block, onshore West Java from Lundin Petroleum AB.

Tap Energy reached a deal with Lundin in late November last year to buy the stakes. Rangkas Block covers an area of 3,997 km2, located in southwest of Jakarta. After the stake purchase, Lundin Rangkas B.V’s interest in the block reduced to 51% and The remainder 25% is held by Carnarvon Petroleum (Indonesia) Pty Ltd). Lundin Rangkas is the operator of the block.

Tap Energy said that previous exploration seismic and drilling in the block, along with the presence of surface oil seeps, indicates the presence of an active petroleum system. A seismic survey of up to 500 km is planned for the first half of 2010, targeting a number of leads identified in recent reviews of the block.

“Those reviews lead us to believe that there is significant untested potential, including previously unrecognized deep targets analogues to proven production in adjacent blocks,” it said. (Roffie Kurniawan)

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Interra profit dropped 13%

Interra Resources, an oil and gas company controlled by Edwin Soeryadjaya, reported net sales revenue of US$12.62 million last year, declined 28% from the previous year, while net profit dropped 13% to US$1.48 million.

The 28% decrease was a result of a combination of lower oil prices and decreased production (mainly in Indonesia oil fields) during the year. Shareable production in 2009 of 270,953 barrels was lower as compared to 302,450 barrels in 2008.

The weighted average oil price in 2009 of US$65 per barrel was significantly lower than of the corresponding period of 2008 of US$100 per barrel. The cost of production in 2009 of US$9.18 million was lower compared to US$10.71 million in 2008. As a result, gross profit in 2009 was US$3.44 million as compared to gross profit of US$6.77 million in 2008.

Other income for 2009 was significantly higher than 2008, due largely to the reversal of impairment and provision made against the Myanmar assets of US$3 million, partly offset by a decrease of interest income from US$0.51 million in 2008 to US$0.10 million in 2009 as a result of lower interest rate in 2009. The increase was partly offset by a provision made for the write off of the exploration well (MS-1) and pending relinquishment of Block L3 in Thailand of US$1.57 million and US$0.47 million respectively.

As a result, the net profit after tax for 2009 was US$1.48 million. This represented a slight decrease of 13% from 2008 of US$1.70 million. Still, Interra's stock price has tripled in the past 12 months.

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EWC revenues grew 7.17%, LNG project delayed

Energy World Corporation reported 7.17% growth in sales revenue for the July-Dec 2009 to US$42.55 million, largely due to the contribution of additional revenue from the Sengkang power and gas projects in South Sulawesi, following the commissioning of the 60 MW power plant on November 17, 2009.

Sengkang power plant is owned and operated by PT Energi Sengkang where EWC owns 95% shares, while Medco Group holds the balance. The power plant was initially designed to deliver 135 MW in combined cycle to the South Sulawesi electricity grid operated by PT PLN, but has subsequently been expanded to deliver 195 MW.

EWC also owns 100% interest in Sengkang PSC which sold 13646 TJ of gas during the financial year ended June 30, 2009 compared with 9821 TJ in the previous financial year. Gas sold for the the half year ended Dec 31, 2009 was 6108 TJ.

How about the Sengkang LNG project?

Well, EWC claimed the facility will have a production capacity of 2 million tons per annum and combine four modular LNG trains, each with a 500,000 tons capacity. The initial plan was to operate the first two modular LNG trains in June 2010, but due to a series of delays in the approval process, the facility will not now commence until 2011.

EWC's stock has lost 60% its value since June 2009...

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AED secures financing for Indonesian acquisitions

AED Oil Limited has entered into two new financing facilities and repaid its maturing convertible notes. AED now has long term finance in place to fund its expansion into South East Asia through the acquisition of interests in Brunei and Indonesia. AED has previously entered into acquisition of two blocks in Indonesia, Rombebai and South Madura.

Highlights of the refinancing are: (1) The issue of new convertible notes to the value of US$20 million and an option if funds are required and subject to certain circumstances to issue further New Convertible Notes to the value of US$10 million; (2) A$20 million general purpose loan facility with Deutsche Bank AG, and (3) US$27.5 million 6.5% convertible notes repaid. AED has cash balance of about A$50 million in addition to these new financing facilities.

The oil and gas gas assets purchased are controlled by two Indonesian businessmen.

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Elnusa-Nordic gets new contract

Oil and gas services company PT Elnusa (ELSA) Tbk and its partner Nordic (Norway) have just secured 2D geoscience project for Seruway area, Aceh for a period of two years.
Elnusa provided no details about the new contract. Elnusa is accomplishing two 3D seismic projects worth US$33.7 million in Kalimantan and Papua. These projects will be accomplished in June.
Elnusa expects to get Rp1.4 trillion revenue from geoscience projects this year, while the consolidated revenue target for 2010 is Rp4.46 trillion, increased 29% from last year.

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Talisman oil & gas output grew 19%

Talisman reported 19% growth of oil and gas production in Indonesia to 66.500 barrel oil equivalent per day with record production from Corridor block due to higher contract takes.

Last month, Talisman acquired a 25% interest in the onshore Jambi Merang Block where development is underway. Talisman drilled three exploration and 23 development wells in 2009.

Talisman plans to spend $1.1 billion in Southeast Asia in 2010, with exploration spending accounting for $280 million, or 26% of the total.Talisman will commence the Makassar Strait drilling program in Indonesia with two wells in the Pasangkayu block and will acquire seismic in the Andaman III block.

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PGN-Pertamina JV

Two state-owned companies, PT Perusahaan Gas Negara (PGAS) Tbk and PT Pertamina, have finally signed the JV agreement for LNG floating storage and regasification terminal (FRST) to be built in West Java.

The JV agreement was signed today by PGAS CEO Hendi Prio Santoso and Pertamina CEO Karen Agustiawan, witnessed by SOEs minister Mustafa Abubakar and energy minister Darwin Zahedy Saleh.

According to the agreement, Pertamina controls 60% shares in the JV, while PGAS controls the balance. Pertamina will have its people as CEO and Director for operations of the JV, plus one commissioner, while PGAS will be represented by finance and administration director plus one commissioner.

LNG for the facility will be sourced from East Kalimantan for a combined 11.75 million tons in 11 years. The gas itself will be supplied to state-owned power producer PT Perusahaan Listrik Negara (PLN). The JV will start construction of the FRST this year.

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Total chases Papua oil & gas block

Total SA is in serious talks related to the acquisition of ConocoPhillips' participating interest in Warim oil and gas block, Papua. This is part of the company's expansion plans in Indonesia. State-owned oil and gas company Pertamina is also looking into Warim acquisition.

Warim PSC was signed in May 1987. This is an onshore exploration block in an area of Papua that covers 5795 square miles. ConocoPhillips owns 80% participating interest in the block, while Santos Pty Ltd holds the remaining balance. ConocoPhillips is the operator of the block. 

ConocoPhillips also owns 100% Amborip VI PSC, 60% in Kuma PSC, and 100% in Arafura Sea PSC. These blocks were awarded in the period of 2006-2008. Conoco's producing assets are Block B PSC, South Natuna Sea (40%), Corridor Block PSC (54%), and South Jambi "B" PSC (45%).

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Elnusa seeks Rp4.46 trillion revenue

Oil and gas services company PT Elnusa (ELSA) Tbk is working on geoscience service contracts worth US$47.9 million, most of which will be accomplished this year. How about the new contracts? Well, the company has only secured US$2.8 million contract so far.

Elnusa told IDX this morning that geoscience projects in Sumatra and Java will mainly be accomplished this year, including the 3D land seismic in South Sumatra (US$4.9 million) and 3D seismic in Jambi (US$5.4 million). The largest, land seismic project in Java, worth US$34.8 million will be accomplished this month.

Until third quarter 2009, Elnusa reported revenue of Rp2.49 trillion, increased 51%, from the same period in 2008, where geoscience unit contributed Rp960 billion or about 56% of total revenue in the upstream oil and gas services business. Elnusa reported EBITDA of Rp398.92 billion in Jan-Sep 2009, surged 92% from the same period of 2008.

ELSA is targeting Rp4.46 trillion of revenue this year. The company expects geoscience services would contribute Rp1.44 trillion. Elnusa currently has market capitalization of Rp2.37 trillion. Pertamina is controlling shareholder of this company, followed by Tri Daya Esta. Recapital Advisors has yet to close the acquisition of Tri Daya Esta's 37% shares in this company.

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Sukowati oilfield investigated for poisonous gas

The Upstream Oil and Gas Regulatory Body (BPMigas) has sent a team to investigate hydrogen sulfide outflow in Petrochina-operated Sukowati oilfield in Bojonegoro regency, East Java this week. Operation of the field has been halted for few days as residents complained about the poisonous gas.

"But according to our investigation, the gas outflow is normal," Sukarnoto Sukimin, field manager of the joint operating body Pertamina-Petrochina East Java told Kompas.com on Sunday.

BPMigas investigation team has been deployed to the oilfield on Saturday. Production activities on the 3,000 bpd oilfield has been suspended, but may be resumed in the next few days.

Bojonegoro Police has instructed an investigation on the gas outflow as hundreds of people complained about the gas outflow might have poisoned them. Hopefully this will not become the next Lapindo mudflow.

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Tanjung Miring Timur oil output drops 14%

Interra Resources, a company controlled by Indonesian businessman Edwin Soeryadjaya, reported gross production of oil at Tanjung Miring Timur of 38,068 barrels in the fourth quarter of 2009, declined 14% from the previous quarter due to mechanical difficulties in the lifting equipment.

"Mechanical difficulties in the lifting equipment resulted in significant down time. Oil movement and transportation equipment problems were experienced by the operator during the quarter," Interra said in a statement. 

A reassessment of the current production activities and plans, and an evaluation of the scope of future development strategy 

are underway bInterra internally. Interra owns 70% of the technical assistance contract (TAC) with state-owned oil and gas company Pertamina.

Interra also owns 50% participating interest in three oil and gas blocks in Thailand and one block it acquired in Australia last November. It also operates YNG 3234 oil block in Myanmar.

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Carnarvon on Rangkas Block

Carnarvon Petroleum said a seismic survey of up to 500 Km at Rangkas oil and gas block is in planning for acquisition in the third quarter of this year. Based on the results of this seismic survey, the joint venture may commit to additional seismic and drilling in 2011-2012.

Carnarvon is the owner of 25% participating interest in Rangkas PSC. Others are Lundin Petroleum with 51% interest and Tap Oil 24%. Lundin is the operator of the PSC, located onshore West Java, southwest of Jakarta, and covers an area of 3977 Km2.

Previous drilling in the block and surface oil seeps confirm an active petroleum system. Several prospects and leads are identified in the block based on reprocessed 2D seismic data.

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AWE to farm-out Terumbu PSC

Australia Worldwide Exploration (AWE) Ltd, owner of 42.5% participating interest in Bulu production sharing contract (PSC), will start exploration drilling at Liyun-1 well in March 2010. The well will target an Early Miocene reef complex with the potential to hold 75 million barrels of recoverable oil.

AWE said Lengo-2 well will also be drilled in the program to appraise the gas discovery made in early 2008. AWE told investors this morning that it has defined a number of sizeable follow up prospects in Bulu and in its 100% held adjacent Terumbu PSC, where its actively progressing plans to drill one or two exploration wells.

"AWE is considering farming out a portion of the Terumbu PSC," the company said in a quarterly report. The 3D seismic survey in the eastern portion of the Bulu PSC and in the newly acquired Terumbu PSC has been interpreted and numerous reef prospects have been mapped.

In East Muriah PSC, where AWE has 50% interest, a 1,200-Km 2D seismic survey acquired was processed and is being interpreted. 

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