Chevron to review E. Kalimantan deepwater gas project

U.S energy giant Chevron Corp. will review a US$7 billion project to extract natural gas in Indonesia?s first deep-sea drilling venture because of the global recession, The Jakarta Post reported Thursday.

Chevron will consider the cost and schedule to develop the gas fields off the country?s part of Borneo, Suwito Anggoro, president director of the oil company?s Indonesian unit, said in Jakarta Wednesday.

?We see it is as a prospective project in the future,? Anggoro said. ?We?re committed to developing the deep-water areas.?

Meanwhile, deputy of planning at Indonesian oil and gas regulator BPMIGAS, Achmad Luthfi said: ?We?re waiting for Chevron to submit the revision to the plan of development to us,?

In August last year, the government had approved of the plan of development (PoD) for a natural gas exploitation project in the deepwater areas of East Kalimantan

The projects aims to exploit natural gas from the Gendalo, Maha, Gandang, Gehem and Ranggas fields of the Ganal and Rapak PSCs, which are part of the Ganal and Rapak PSCs, owned by Chevron (80 percent) and Italian firm Eni SpA (20 percent).

The gas from the fields will boost supply to a liquefied natural gas (LNG) plant at Bontang in East Kalimantan province and thus will boost the country?s LNG production.

?Most of the LNG produced from the gas these fields produce will be exported,? Edy Hermantoro, Upstream Director at the Ministry of Energy and Mineral Resources, said. ?We will allocate at least 25 percent of the output for the domestic market.?

Director General of Oil and Gas Evita Legowo told Petromindo.Com on Sept 4, 2008 that Chevron and its partner would invest US$6.984 billion for the project, including $2.196 billion for the drilling of 28 wells and $4.788 billion for the construction of production facilities. (*)