Roy M. Huffington Inc., Houston, will transfer management responsibilities for its East Kalimantan, Indonesia, oil and gas joint venture to two of its joint venture partners, Union Texas Petroleum Holdings Inc. and Ultramar plc.
Virginia Indonesia Co., an affiliate of Union Texas and Ultramar, is expected to offer comparable employment to Huffington personnel, which number about 2,200 persons, including more than 1,900 Indonesians.
The companies are negotiating a definitive agreement, and the transfer is to take effect Mar. 31.
The parent Huffington Corp. moved in November 1989 to find a buyer for its stock (OGJ, Dec. 4, 1989, Newsletter).
Gross Huffington joint venture revenues were expected to be about $830 million in 1989.
The Indonesian joint venture produces 1.3 bcfd of gas, most of which is converted to liquefied natural gas at the four train Badak LNG plant at Bontang, East Kalimantan, a few miles north of the gas fields.
The LNG is sold to utilities and industrial customers in Japan.
A fifth train is being added to the LNG plant.
The number of Huffington LNG cargoes shipped this year and beyond is expected to increase substantially from the 145 shipments scheduled in 1989.
The increase is expected as deliveries begin under a 20 year contract with Taiwan and new LNG sales contracts are signed.
PRODUCTION, RESERVES
Huffington's East Kalimantan fields are capable of producing 2 bcfd of gas.
Production in late November 1989 also included 38,000 b/d of crude oil and condensate.
Reserves are about 6.1 tcf of gas and 128 million bbl of oil and condensate.
Huffington has operated in Indonesia since 1968. It operates the Indonesian properties under a production sharing contract.
By the time the parent company offered its stock for sale, Huffington had agreed in principle with Indonesian authorities to extend the term of the contract 20 years to terminate in 2018.
The 1.5 million acre production sharing contract area has substantial exploration potential, and some of the identified prospects and leads are to be drilled soon, Huffington said.
Huffington owns a 20% interest in the joint venture. Through various subsidiaries, including Virginia Indonesia, Union Texas and Ultramar each hold 37.8% interests. Universe Tankships Inc. is the other owner.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.
