Chevron says deepwater project to produce 1BCFD

U.S energy giant Chevron Corp. said its deep water gas project offshore East Kalimantan would produce 1BCFD at its peak rate.

Michael Craig, Project Manager Indonesia Deepwater-Chevron IndoAsia told conference participants on Thursday that the project, which will be the fisrt deepwater subsea mega project in Indonesia would require development capital of US$7-8.5 billion and first gas is estimated 6.5-8 years from PoD approval. PoD for the project was approved by the government last year.

Craig went on to say that the project would extract 2-4TCF of gas in the form of development of 5 integrated gas fields in 4 PSCs namely Muara Bakau PSC, Makassar Strait PSC, Ganal PSC and Rapak PSC.

Craig, however, when interviewed, said that the costs estimated had yet taken into account the falling trend of declining prices of EPC materials such as steel pipes.

Chevron IndoAsia Deputy managing Director Suwito Anggoro was reported as saying by media that Chevron is currently reviewing the deepwater project due to financial melt down and falling energy prices.

A number of oil, gas companies have slashed their project due to falling energy prices that have made their project economically unfeasible. A senior official at upstream oil, gas authority BPMIGAS last year said that the deepwater project would need selling price of $8.5 per MMBTU to make it feasible.

Suwito earlier told Petromindo.Com that Chevron is currently making preparation to tender the project?s FEED. He did not give the timeline. (alex)