ConocoPhillips cancels plan to sell stake in Aceh gas block
Monday, June 26 2006 - 12:44 AM WIB
?ConocoPhillips has officially announced that it was not selling its interest in Aceh Block A PSC; we therefore are working together with ConocoPhillips now to develop the block,? Medco director Rashid I Mangunkusumo told Petromindo.Com. ConocoPhillips is the operator of the block with 50 percent working interest. ConocoPhillips had earlier intended to sell its stake in the block due to instable security condition in Aceh, but apparently it had changed its mind after Aceh rebel and central government signed peace deal.
ConocoPhillips official contacted by Petromindo.Com declined to comment on the matter.
Medco, together with Premier oil and Japex had acquired 50 percent non-operating interest in the block from previous owner Exxon Mobil Corp. for US$51 million earlier this year. The consortium was also in talks to acquire ConocoPhillips interest in the block.
An industry source told Petromindo. Com that ConocoPhillips decision not to sell was also prompted by the fact that it had been in advanced talks with Aceh fertilizer maker PT. Pupuk Iskandar Muda (PIM) to supply gas to the firm which is currently scrambling to get gas supply to continue operations. ?PIM is willing to buy Block A?s gas at premium price,? the source said. In addition, said the source, the government had also agreed to improve contractor?s split on the block from 35 percent to 48 percent.
The block contains undeveloped discoveries on the Alur Siwah, Alur Rambong, and Julu Rayeu fields certified as holding over 650 Bcf gross of proved and probable reserves.
The block also offers substantial exploration upside. Around 20 prospects have been identified with total prognosed unrisked reserves of 1.5 tcf gross.
The government had been pushing to have natural gas flowing from Block A by 2008-2009. (godang)