ConocoPhillips to become operator of Suban III gas field

ConocoPhillips and PT Pertamina EP, a subsidiary of state owned oil, gas company PT Pertamina, was quoted by Bisnis Indonesia as saying that both parties have reached an agreement to develop Suban III gas field in Corridor block PSC onshore South Sumatra, with ConocoPhillips to play a role as operator of the field.

Senior vice president for upstream strategic planning and subsidiary management of PT Pertamina, Salis S. Aprilian, said that both parties have agreed to develop the project.

?Pertamina EP lets the operator to deal with the commercial aspect of the gas from the field. We don?t know yet whether gas produced from the field will all be sold to Singapore or portion of it will be allocated to domestic buyers,? Salis said.

He said the domestic gas allocation will depend on the capability of domestic buyers to absorb the gas at competitive price compared to export gas market price.

Earlier, PT Pertamina EP said it expected to develop Suban III gas field in ConocoPhillips? Corridor block, onshore South Sumatra by the end of 2011.

Meanwhile, manufacturers are calling on the upstream oil and gas regulator BPMIGAS to allocate gas from the Suban III field to meet domestic market. Domestic buyers are willing to purchase gas from the field at price of around US$8 per MMBTU. (*)