Oil Diplomacy Editor
LOS ANGELES, Dec. 19 -- Indonesia's publicly listed oil and gas company PT Medco Energi Internasional predicts that its oil and gas production could drop in 2009 by as much as 10% due to asset sales and aging fields.
Medco finance director Cyril Noerhadi said the firm had sold participating shares in the Tuban block to state-owned PT Pertamina and in the Simenggaris block to Salamander Energy Ltd.
"Aside from that, our fields on average are already at the aging stage and can no longer produce optimally," Cyril said.
During the first 9 months of 2008, Medco oil and gas production totaled 65,460 b/d of oil equivalent, down 6.4% from the 69,970 b/d produced during the same period in 2007.
Last year, Medco's oil production alone reached 50,411 b/d, down from 56,367 b/d in 2006.
Output could increase
The directorl said Medco's oil and gas output likely would start increasing again in 2011 after seven key projects are completed.
Although Medco recorded a 51.6% increase in revenue between the first 9 months of 2008, climbing to $972.2 million over last year's $641.4 million, Cyril declined to state how much the firm planned by way of capital expenditure next year.
"The current economic conditions will narrow down alternatives for capital access," Cyril said, adding that Medco normally spends $250-300 million annually.
Meanwhile, Medco Pres.-Director Darmoyo Doyoatmojo said new gas facilities being installed on South Sumatra's Lematang Block would be completed in June 2009.
Darmoyo said the remaining projects, which will be completed in 2011-12, include Block A gas field in Aceh, the enhanced oil recovery project on Block Rimau in South Sumatra, Area 47 in Libya, the Senoro gas field in Central Sulawesi, and a power project in Sarulla, North Sumatra.
Darmoyo also said the company would intensify its search for overseas oil and gas fields as the success rate for confirming feasible reserves in Indonesia remains very low at between 10-15%.
Contact Eric Watkins at firstname.lastname@example.org.