ENI, Exxon talks over Aceh gas facilities usage

Italian oil, gas firm ENI SpA has not submitted plan of development (PoD) for its Krueng Mane block offshore Aceh because it is still in talks with ExxonMobil Indonesia over the possibility of using the latter?s facilities, a BPMIGAS official said on Wednesday.

BPMIGAS Deputy Chairman Achmad Luthfi told Petromindo.Com that facilities sharing would enable ENI to enhance the economics of the gas field?s development.

If the deal goes through, he said, ENI would be able to use Exxon?s pipeline to supply gas to Arun LNG plant.

Luthfi said exploration license for Krueng Mane expired in September this year, but the government has yet to decide whether to grant further extension to Eni. Under the Indonesian PSC regulation, PSC contractors normally get maximum of 10 years exploration period. Krueng Mane contract was signed in 1999.

?It?s up to the government to decide whether or not Krueng Mane exploration license would be extended,? he said.

Separately, Eddy Hermantoro, a senior official at the Ministry of Energy and Mineral Resources said that the government is still evaluating the contract. ?The government will evaluate whether Eni has carried out its obligation and is still committed to developing the block?.

Krueng Mane is located approximately 50 km north of the Arun LNG plant. ENI has currently 100 percent interest in the block.

The block has proven undeveloped reserves of 183 billion cubic feet within the JAU field and exploration potential of at least 4.5 trillion cubic feet reserves in the three main prospects (BSN, Safir & Emerald). (bernard)