Chevron suspends EPC tender for IDD project

Chevron Indonesia Company has suspended the EPC tender process for the development of gas blocks under the Indonesia Deep water Development (IDD) project in the Makassar Strait as the company is still waiting for the government?s decision over its request for an extension of its contracts over the blocks, Kontan reported on Tuesday.

The suspension of the EPC tender could eventually postpone the production of the blocks from the initial schedule of 2016 and 2018.

?There has been a number of winning candidates, but (the tender) has been suspended, ? said Agus Kurnia, Head of Project Management and Facilities Maintenance Division at the upstream oil and gas authority SKK Migas to Kontan.

Agus said that during the suspension period, Chevron will review the feasibility of the project and whether it would go ahead or not. ?There is no certainty yet as to when the project will be resumed, it depends on Chevron and also the government,? he said.

This portal reported in October, quoting Naryanto Wagimin, a senior official at the Ministry of Energy and Mineral Resources, as saying that the company has made a request to the ministry for a postponement of the IDD project due to the higher economic value of the project than initially estimated.

The IDD project comprises of four gas blocks including Ganal, Rapak, Makassar Strait, and Muara Bakau, covering five fields including Bangka, Gehem, Gendalo, Maha, and Gandang. The blocks of Ganal, Rapak, and Makassar Strait are operated by Chevron, while the Muara Bakau block by Eni Spa. According to an earlier estimate, the IDD project was supposed to produce 1,270 mmscfd of gas.

The Bangka field was expected to be operational in 2016 to be followed by Gehem and Gendalo in 2018.

Meanwhile, Chevron?s contract over the Makassar Strait block will expire in 2020, Ganal in 2028, and Rapak in 2027. Chevron wants all contracts to be extended to 2028.

Meanwhile, Yanto Sianipar, Vice President for Policy, Government, and Public Affairs at Chevron Indonesia, told Kontan that the Bangka field development in the Rapak block, which will expire in 2027, continues. (*)