Eni to give up disputed block

By Bernard Loebs

Italian oil and gas giant Eni SpA is in the process of relinquishing Bukat exploration block offshore East Kalimantan.

An official with upstream oil and gas authority SKK Migas told Petromindo.Com that Eni will give back the block back to the government as it elected not to file request to extend the block?s exploration period.

Eni has managed to make two significant discoveries in the block namely Tulip and Aster, which, according to the then Minister of Energy Purnomo Yusgiantoro in 2009, could be developed to produce 30,000-40,000 bpd of oil.

Former partner in the block, US firm Anadarko Petroleum, reported in 2011 that the Borago well was spudded at Bukat at the end of the 4th quarter in 2010 and later was declared a dry hole.

Part of the block is located within the territorial area disputed by Indonesia and Malaysia.

The official also said that Eni is currently freezing exploration activities at the nearby Ambalat block, which is also a disputed object with Malaysia.

Eni has 66.25 percent interest in both blocks with PT Pertamina Hulu Energi holding the balance.

Editing by Alexander Ginting