Indonesia's civil unrest fails to halt production

Indonesia's civil unrest has forced oil companies doing business there to evacuate some personnel and their families from Jakarta. However, U.S. and Canadian companies reported that employees working inland and offshore are far enough removed from the rioting and demonstrations that evacuation is not needed.

The U.S. Department of State has warned all U.S. citizens to defer travel to Indonesia and is strongly urging Americans in Jakarta and Surabaya to leave. U.S. citizens in other parts of Indonesia also should consider departing the country at this time.

Two U.K. citizens in Jakarta were killed, in separate incidents, after entering taxis, according to the U.S. embassy in Jakarta.

Rioting, looting, and destruction of property have occurred in numerous Indonesian cities and have resulted in over 500 deaths in Jakarta, the U.S. State Department said.

According to an embassy report, "While most of the violence has been centered in Jakarta, there is potential for it to spread." The embassy was expecting country-wide demonstrations to take place on May 20, possibly resulting in extensive violence.

Oil firms on alert

So far, there have been no reports of U.S. or Canadian oil company employee injuries.

Unocal Corp. spokesman David Garcia said the company's Jakarta office has been closed, and employees there have already been evacuated. But, he added, the company's E&P operations off East Kalimantan have not been affected.

"Unocal will continue to monitor the situation there daily," Garcia said. "I really don't know when we will reopen the (Jakarta) office."

Three Calgary-based oil companies closed offices in Jakarta and moved employees and their dependents to safe areas as a result of widespread rioting.

Gulf Canada Resources Ltd., Talisman Energy Inc., and Carmanah Resources Ltd. moved about 90 Canadian staff and their families to safe zones inside or outside Jakarta. The companies said operations outside the Indonesian capital have not been affected.

The Canadian firms said no employees had been hurt and no offices damaged as a result of the riots. The three firms collectively produce about 54,800 b/d in Indonesia.

Carmanah Resources said its offshore operations in Indonesia are continuing and are unaffected by the country's current political and social unrest. But, as a precautionary measure, the families of expatriate employees have been evacuated to Singapore. And last week, most of its remaining expatriate staff were either moved to offshore facilities or temporarily relocated to Singapore.

Carmanah's main assets and activities are in Camar field, 60 miles off Java. A major development drilling and facilities installation program is under way at Camar.

Carmanah said it will continue to sell its oil production to Pertamina, the Indonesian state oil company. While payment for an earlier lifting was delayed, Carmanah anticipates this will be remedied shortly.

Talisman said all of its production and construction activities in Indonesia are continuing and are not affected by recent events in the country. But, following a Canadian embassy warning, Talisman temporarily evacuated all expatriate family members and most expatriate employees.

Talisman is maintaining a small management group in Indonesia in a safe area, said Talisman Pres. & CEO Jim Buckee, as are many other companies. The management group will provide support to Talisman's local Indonesian employees and joint venture partner Pertamina to ensure that the operations continue at a high level of effectiveness, he said.

U.S.-based ARCO has temporarily closed its offices in Jakarta to assure the safety of all its personnel in Indonesia. The firm has evacuated most of its expatriate employees and their families from Jakarta.

A contingent of ARCO executives, headed by ARCO Indonesia Inc. Pres. Leon Codron, remains in Jakarta to coordinate the company's activities. ARCO's oil and gas production operations in Indonesia remain unaffected, a company spokesperson said.

Australian firm City View Energy Corp. Ltd. said its office in Jakarta "remains fully operational, and its chief executive in Indonesia, Lutfi Heyder, continues to be in active dialogue with officials."

The company reported that its managing director, Mark Smyth, was planning to be in Indonesia last weekend to discuss with Heyder opportunities that are now emerging in the country's oil and gas industry.