JAKARTA (TheInsiderStories) - An oil and gas company from Spain, Repsol SA (BSE: REP), is studying the potential of a giant geological carbon capture and storage project in Sakakemang Block located in South Sumatera. The proposed scheme will allow the energy firm to capture an estimated 2 million tones of carbon dioxide per year, associated with the development of the natural gas reserves starting 2026.
The producer also said is studying the potential to inject carbon dioxide into the Dayung and Gelam fields within the nearby ConocoPhillips-operated Corridor Block. End of last year, the energy producer has obtained approval from the government for the First Plan of Development (PoD) of the Kaliberau Field in the Sakakemang Block, South Sumatra.
The energy and mineral resources (EMR) ministry has approved the First PoD for the field. The investment value required to develop the field is estimated at $359 million. With the approval, the realization of the Reserve Replacement Ratio of the project is estimating will reach 102 percent or 705.2 million barrels of oil equivalent in 2020.
Through this project, the government will get state revenue of $413 million during the validity period of the Repsol contract in this block. The POD of the Kaliberau Field was approved in order to produce gas reserves of 445.10 billion standard cubic feet (BSCF) up to the project’ economic limit in 2038.
The economic deadline for the project is 287.70 BSCF of gas sales with a peak gas production rate of 85 million standard cubic feet per day and a cumulative condensate production of 0.17 MMSTB with a peak production rate of 34 barrels of condensate per day. The development of the Kaliberau Field is believed to provide benefits, including monetization of gas fields that are close to the infrastructure of the existing gas distribution network and can meet the domestic gas needs quickly and efficiently.
In addition, the development of this field also will increases the national gas production and has a multiplier effect. Earlier, SKKMigas has asked Repsol to meet the POD even did not agree on a gas selling price of $6 per million british thermal units. Repsol, as the operator of the oil and gas block, not agreed with the gas selling price. The upstream oil and gas regulator said, will find solutions so that the project can be profitable for contractors.
In addition, the unit under EMR ministry, also encouraged Repsol to be as efficient as possible so that the selling price of gas can be in accordance with government regulations. Deputy of SKKMigas, Arief Handoko, said Repsol asked that the price of gas be sold above $7 per MMBTU.
The discovery of new gas reserves in the Kaliberau is estimated to have a potential of approximately 2 trillion cubic feet, which is the best finding in oil and gas exploration in Indonesia in 18 years. This finding made Repsol to carry out the second drilling in the field on August 20, 2018 with the assistance of two other consortium members, namely Malaysia’ Petroliam Nasional Bhd and Japan’ Mitsui Oil Exploration.
Initially, the Sakakemang cooperation contract was signed between BP Migas and Cakra Nusa Darma Ltd., on May 18, 2010 for a period of 30 years with an exploration period of six years. Repsol has found gas reserves of up to 2 trillion cubic feet from the Kaliberau, which was traced on August 20, 2018.
Later, the gas produced by the block will be integrated with the production facilities in the Corridor Block. The Sakakemang block is operated by Repsol, which has 45 percent participating rights and the rest is owned by Petronas Bhd 45 percent and MOECO 10 percent. In 2015, Repsol acquired Talisman Energy Inc., for $8.3 billion.
US$1: Rp14,400
Written by Editorial Staff, Email: theinsiderstories@gmail.com
