Chevron maintains production target

Chevron Pacific Indonesia (CPI), the Indonesian subsidiary of US oil and gas giant, has set its production target at 370,000 barrels per day (bpd) for this year, similar to last year's.

To meet the target, the company needs to drill 500 wells annually.

"(Aside from meeting the target) the move is needed to cope with natural production decline," CPI's president director Abdul Hamid Batubara said.

He said thanks to its drilling campaigns, the company managed to curb its production decline to 3.5 percent from 11.7 percent.

Batubara said problems related to land acquisition and control, rather than technical problems, has and would become the main obstacles for the firm to reach the target.

Unrealistic land prices demanded by the public, land disputes, unclear borders between regions and overlapping concessions were among the reasons that the firm could not quickly obtain land ownership documents. This affected the production processs.

"The government and the public have given us minimum supports (to solve the problems," CPI senior vice president for Sumatera oAlbert Simanjuntak said.

As a result Chevron was unable to drill 61 wells last year, he added.

"Potential production loss due to the problems could reach 3,000 bpd of oil," he said.

These challenges alone, if persist, will increase potential production loss to 4,650 bpd, not to mention problems related to work safety and security of facilities.

Chevron remains the backbone of the government in its bid to increase national oil lifting target in 2011. (bernard)