Conoco seeks extension on Irian Jaya exploration

US oil major Conoco Inc Indonesian unit will ask state oil and gas company Pertamina to extend exploration right for Warim production sharing contract (PSC) area onshore Irian Jaya province, where Conoco suspends explorations activities after some parts of the block were considered to be located in the Lorentz National Park conservation zone, according to Conoco?s official.

?The exploration right at Warim PSC will expire sometimes next year and we are seeking three-year extension,? Patrick Meyer, Conoco Indonesia?s president told petromindo.com Friday on sideline of function to celebrate Conoco?s first gas to Singapore.

Meyer said the three-year extension Conoco sought was to compensate the time loss when it stopped exploration in Warim in 1998. He hoped that the extension would give enough time for Conoco to resolve the problem and resume exploration.

Warim block stretches for 200 kilometers from the Jaya Wijaya regency in Irian Jaya's hinterland to the Merauke regency near the Papua New Guinea border.

The block is bordered by the Lorentz National Park on the west, which was put on the World Heritage list by the United Nations of Educational, Scientific and Cultural Organization (UNESCO) in 1999.

The block was considered to be located outside the national park when Conoco received its PSC from Pertamina in 1987. But, the government expanded the national park's territory to also cover 150,000 hectares of the Warim block in September 1998, forcing Conoco to halt exploration activities in the area.

Meyer said Conoco was still working with the government to review decision to expand the Lorentz National park boundaries to enable it to resume its exploration works.

?We choose not resume exploration until the problem is resolved,? said Meyer.

Meyer said Conoco had spent US$ 182 million on the block since 1987.

He further said that Conoco believed there was a potential for substantial oil reserve in the block as earlier drillings had found oil, but still in non-commercial quantity, in the block.

?But those findings lead us to believe that there were oil to be found in the block,? said Meyer.

Meanwhile, industry sources said that ministry of energy and mineral resources, Pertamina and Irian Jaya government had backed Conoco?s request to review the national park border. However, said the sources, the final say was in the hand of the ministry of forestry, which still objected to the request.

Conoco has 80 percent participating interest in the block, while Australian oil firm Santos Limited holds the remaining 20 percent. (alex/godang)