Chevron updates Indonesian oil, gas ops
Tuesday, March 1 2011 - 09:51 AM WIB
Chevron holds interests in operated and nonoperated joint ventures in Indonesia. The company has 100 percent-owned and operated interests in the Rokan and Siak PSCs onshore Sumatra. The company's interest in the Mountain Front Kuantan PSC was transferred to a local operator in second quarter 2010. Chevron also operates four PSCs in the Kutei Basin, located offshore East Kalimantan.
These interests range from 80 percent to 92.5 percent. Chevron also has a 25 percent nonoperated working interest in a joint venture in Block B in the South Natuna Sea. The company relinquished its 40 percent interest in the NE Madura III Block in the East Java Sea Basin in fourth quarter 2010 following an unsuccessful obligation well in 2009.
Chevron also relinquished its interest in the 100 percent-owned and operated East Ambalat PSC in December 2010. The relinquishments of NE Madura III and East Ambalat are both pending approval by the government of Indonesia.
The company's net oil-equivalent production in 2010 from all of its interests in Indonesia averaged 226,000 barrels per day. The daily oil-equivalent rate comprised 187,000 barrels of liquids and 236 million cubic feet of natural gas. The largest producing field is Duri, located in the Rokan PSC. Duri has been under steamflood operation since 1985 and is one of the world's largest steamflood developments. The North Duri Development is divided into multiple expansion areas.
The expansion in Area 12 was completed in 2010 with the additional drilling of 72 production, 24 steam injection, and 10 observation wells. During the year, ramp-up of steam injection continued with the project reaching a maximum total daily production of 45,000 barrels in September 2010.
A final investment decision regarding North Duri Area 13 was reached May 2010, and is awaiting final development plan and bid award approvals from the government of Indonesia. The Rokan PSC expires in 2021.
In 2010, Chevron advanced its development plans for the Gendalo-Gehem deepwater natural gas project located in the Kutei Basin, awarding major FEED contracts for the floating production units, subsea and pipeline components, and onshore receiving facility. Maximum daily total production from the project is expected to be 1.1 billion cubic feet of natural gas and 31,000 barrels of condensate. Completion of FEED is dependent upon government approvals and achieving project milestones. The Bangka deepwater natural gas project progressed during the year, and entered FEED in fourth quarter 2010.
During 2010, the company reached an agreement to farm-out a portion of its working interest in the PSCs of the two projects. Government approval of the farm-out is expected in the second-half 2011. In addition, in 2011 the company expects to farm-in an Indonesian company to the PSCs for the two projects. Following government approval of the agreements, the company's production interest in the Gendalo-Gehem and Bangka projects will be 55.1 percent and 54 percent, respectively. Proved reserves have not been recognized for these projects.
Also in the Kutei Basin, the company reached a final investment decision in August 2010 for an oil development project in the West Seno Field and recognized proved reserves related to the project.
A drilling campaign continued through 2010 in South Natuna Sea Block B to provide additional supply for long-term natural gas sales contracts, with additional development drilling planned for 2011. The North Belut development project achieved maximum total daily production of 240 million cubic feet of natural gas and 33,000 barrels of liquids in February 2010. Development of the South Belut project continued during the year. The Bawal project reached final investment decision in October 2010 and is expected to begin production in 2012.
Exploration activities continued in the Central Sumatra Basin during 2010. Two wells drilled in the Rokan Block were successful and placed on production. Additional appraisal drilling near the Duri Field identified further expansion opportunities that will be further assessed with 3-D seismic in 2011.
Chevron's operated working interests in two exploration blocks in western Papua, West Papua I and West Papua III, were reduced to 51 percent in second quarter 2010. Geological studies of the two blocks continued in 2010, and 2-D seismic acquisition is expected to start in the first-half 2011.(end of excerpt)