ConocoPhillips to invest US$2.5 bln in Indonesia; explorations in Palangkaraya, Warim blocks underway

CEO of ConocoPhillips Ryan Lance meets with President Joko Widodo at State Palace [image: Cabinet Secretary]
CEO of ConocoPhillips Ryan Lance meets with President Joko Widodo at State Palace [image: Cabinet Secretary]
JAKARTA (rambuenergy.com) – Chairman and CEO of ConocoPhillips Ryan Lance on Monday revealed the company’s long term plan to invest up to US$2.5 billion in Indonesia. He made the statement after paid courtesy call to the Indonesian President Joko Widodo (Jokowi).

Ryan Lance was accompanied by President and GM ConocoPhillips Indonesia Erec S. Issacson and Vice President for Development and Relations Joang Laksono. The President was accompanied by the Energy and Mineral Resources Minister Sudirman Said and State Secretary Pratikno during the meeting.

Ryan Lance told reporters that he was happy to meet with the President and reiterated the company’s future investment plans in Indonesia. Ryan Lance said ConocoPhillips has been operating in Indonesia for over the last 40 years and has invested US$2.5 billion over the past four years.

“We are also planning to invest US$2.5 billion in Indonesia,” Ryan Lance told reporters after meeting with the President.

The ConocoPhillips CEO met with the President as the company is embarking on exploration activities in two exploration blocks, Warim Block in West Papua and Palangkarayan Block in Central Kalimantan. ConocoPhillips holds 80 percent and 100 percent working interest in the two blocks respectively.

The Warim PSC was awarded in 1987 and currently in exploration stage. In 2013, the company signed an amendment of the PSC which enables the company to continue the exploration activities for the next five years to determine whether the company will move ahead to production stage. Its contract will expire in 2013.

Conoco operates the Palangkaraya block through its subsidiary Petcon Borneo Ltd. The company said in its website that the drilling operation is scheduled to begin in the first quarter of 2015, delayed from November 2014.

Petcon Borneo has earlier said it would spend US$60 million for six years period to explore Palangkaraya Block in Palangkaraya Municipality, Kapuas Regency. About US$20 million would be used for the first three years and the remaining US$40 million will be spent in the subsequent three years. The exploration activities during the first three years are focused on geology and geophysics surveys and reviews. This exploration plan covers a total area of 7,612 Km.

ConocoPhillips Operations

ConocoPhillips currently operates five production sharing contracts (PSCs) in Indonesia, including one offshore block, Block B PSC in South Natuna Sea, and four onshore blocks, the Corridor Block PSC and the South Jambi ‘B’ PSC, both in South Sumatera, the Warim PSC in Papua and the Palangkaraya PSC in Central Kalimantan.

In Block B PSC, South Natuna Sea, Conoco Phillips (operator) partners with Inpex (35 percent) and Chevron 25 percent. The PSC was awarded in 1968 and scheduled to expire in 2028. The natural gas from the block is sold to Singapore and Malaysia through two long-term contracts. The PSC is part of the West Natuna Gas Supply Gorup, a group of three PSCs that supply gas to Singapore.

In 2012, the Bawal Field began production and in 2014 South Belut has also delivered to this gas market. These new fields are part of the continued development of the block to support existing gas sale commitments. Liquefied petroleum gas (LPG) is sold to Indonesia through a contract with Pertamina.

In the Corridor Block, Conoco (operator; 54 percent) partners with Talisman (36 percent) and Pertamina (10 percent), and in South Jambi “B” Block PSC, Conoco (45 percent) acts as operator and partners with PetroChina (30 percent) and Pertamina (25 percent). The PSC was awarded in 1990 and will expire in 2020.

The other two blocks, Warim Block and Palangkaraya Block are exploration blocks, in which Conoco holds 80 percent and 100 percent working interest respectively. (*)


Written by Rambu Energy staff writer (editorial@rambuenergy.com)

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