JAKARTA (TheInsiderStories) - Repsol Indonesia, an oil and gas company controlled by Spain’ Repsol SA (BSE: REP) has just obtained government approval for the First Plan of Development (POD) Kaliberau Field in the Sakakemang Block working areas, South Sumatra. The investment values to develop the field is estimated US$359 million.
Last week, the energy and mineral resources (EMR) ministry has approved the First POD for the field. 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.
“With this approval the cooperation contract are expected (Repsol) to implement the program so that production can be realized immediately,” said Susana Kurniasih, the Special Task Force for Upstream Oil and Gas Business Activities (SKKMigas) spokesman in a written statement last week.
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.
Last year, 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.
Written by Editorial Staff, Email: theinsiderstories@gmail.com
