ExxonMobil Rejects Pertamina’s Plan to Produce Gas from Cepu before Oil
Monday, 18 December, 2006 | 15:33 WIB

TEMPO Interactive, Jakarta: ExxonMobil Oil Indonesia Inc. has stated that it rejects Pertamina's plan to produce gas earlier than oil from the Cepu field.

The reason given by this United States oil company was that the amount of gas reserves at this field is not yet known exactly.

Maman Budiman, the spokesperson for ExxonMoil Oil Indonesia Inc., said that to produce gas from Cepu, further exploration was needed.

“We are focusing on development of the Banyu Urip oil field, the development plan of which has been approved,” Maman told Tempo last weekend.

ExxonMobil and Pertamina are cooperating to develop the Cepu field with each owning 45 percent for each and the remaining 10 percent to be owned by regional companies.

Under this cooperation, ExxonMobil is the operator for Cepu Block management and development.

Previously, Endriartono Sutarto, Pertamina's Chief Commissioner, said that the state-owned oil and gas company will exploit gas first before oil from the Cepu Block.

If ExxonMobil refuses, then Pertamina will develop the gas field without ExxonMobil.

According to Sutarto, the decision to develop gas from the Cepu field was approved at the Annual Shareholders' Meeting (AGM) last week and has also been approved by the government.

Gas will be produced in order to meet gas requirements in East Java.

So far it has been estimated that the Cepu Block, stretching along the border between Central Java and East Java, has oil reserves of 600 million barrels and gas reserves of 1.7 trillion cubic feet.

Muhammad Fasabeni