Government sees upstream oil, gas investment continuing

Government on Monday predicted oil and gas upstream investment in Indonesian would continue to grow next year despite world economic slump and low oil prices.

?We see capital investment for 2002 at about US$ 1.5 billion and routine spending at between $2.5 to $3.5 billion,? said Rachmat Soedibjo, director general of oil and gas at the ministry of energy and mineral resources on a sideline of a conference.

He said the upstream investment would be to develop new oil, gas filed such as ExxonMobil?s Cepu oil field in East Java, Conoco?s oil and gas facilities in West Natuna and Unocal?s oil and gas facilities in West Seno, Makassar Strait.

Rachmat said economic slump that was predicted to linger on in 2002 and falling oil price would not affect Indonesian upstream investment.

?As long as oil price stay above US$ 17 per barrel, we see no negative effect on Indonesia,? he said.

He also said that in 2002, Indonesia would still be able to produce above 1.3 million barrels of oil per day.

In October this year, in an effort to attract more investment, the house of representative passed new oil and gas law that aimed to liberalized Indonesian upstream sector and to dismantle state oil, gas firm Pertamina monopoly.

Oil, gas industrialists said that the effect of the new law for investment was too early to tell since the implementing regulations on the law had yet to be written.(alex/godang)