ExxonMobil, Pertamina agree to jointly operate Cepu block
Monday, March 13 2006 - 11:43 AM WIB
?The Joint Operation Agreement will be signed on March 15. And production would start 31 months after the signing of the JOA,? Pertamina??s president Ari Soemarno told reporters in a joint press conference with ExxonMobil.
The announcement came several days after the installment of Ari as the new president of Pertamina to replace Widya Purnama who was staunchly opposed to ExxonMobil?s efforts to become the operator of the block in a partnership of Pertamina. Widya wanted Pertamina to become the operator in the first years of the operation of the block.
Ari said under the JOA, ExxonMobil will hold the position of general manager in the joint venture that will operate the block, while Pertamina will have its official to fill out the position of deputy general manager.
According to Ari, the block has an oil reserve of 600 million barrels and 1.7 trillion cubic feet of natural gas.
?In the beginning, the block will produce 40,000 barrels of oil per day and the oil output will peak at 170,000 six months after,? he said. He was accompanied by Boediono, the executive director Mobil Cepu Ltd.
In a joint press release, both firms said they would invest US$2 billion to develop the block. The project will have a huge impact on the economies of the people surrounding areas. The multiplier effect could reach $3 and $8 billion in value.
Under the Cooperation Contract signed by Pertamina and ExxonMobil?s subsidiaries and upstream authority BP Migas last year, the firms have to right develop the block over 30 years. (Godang/Alex)