Bumi Siak to invest Rp 116 billion in CPP oil block
Thursday, June 27 2002 - 03:16 AM WIB
The company?s spokesman Kamaruzzaman said in Pekanbaru on Wednesday that the investment funds would be provided by four regencies in the province of Riau including Siak, Bengkalis, Kampar, Pelalawan and provincial administration. "The amount of funds will be in line with the portion of each regency?s shares in the company," he was quoted as saying.
Kamaruzzaman said that if some of the regencies did not have enough funds, Siak regency-administration had expressed its readiness to provide all of the investment needed for the operation of the CPP oil block.
He said that the initial funds were needed to maintain the operation of the 465 oil wells in the 9,996 hectare-oil block and to explore new five oil wells. The exploration would be carried out beginning August 17, this year after the company and Pertamina formally took over the oil block from CPP.
The CPP oil block is part of Caltex Pacific Indonesia?s oil concession areas in Riau. The oil block will, however, be transferred to the government in August after its contract ends. Pertamina and Bumi Siak Pusako have agreed to jointly operate the oil block.
At present, the oil block produces 40,000 barrels per day, far lower than 70,000 barrels per day in the previous years.
Caltex?s president Humayunbosha has said that new investment is needed to maintain the production of the oil block at the current level. "Without new investment, the production will decline by 25 percent a year," he added.
BSP is 90 percent ready both in term of technology and human resources in taking over the operation of the CPP oil block. About 200 Caltex?s employees who are currently working at the CPP will likely move to BSP. (*)