Govt asked to speed up the development of Block A gas field

The development of the Block A gas field in Aceh should be sped up to cope with the continued decline in the gas production in the province, Investor Indonesia newspaper reported on Friday.

"Aceh needs additional gas supplies as soon as possible. The development of the Block A gas field could be the only alternative to cope with the gas shortage," said Effendi Situmorang, the former executive of state owned oil and gas company Pertamina.

He said that if no efforts were made to add the gas supply, more fertilizer producers would be forced to close due to the lack of gas supply. According to him, the Block A, which is operated by ConocoPhillips, has an estimated reserve of 500 billion cubic feet, can provide gas supply for at least 5 years.

ConocoPhillips and its partner has since two years ago expressed their plan to develop the gas field but the plan could not be realized because the government could not meet their request to have a better production sharing deal in the project.

The government has decided to close down the operation of fertilizer plant PT ASEAN Fertilizer Plant in the province due to the lack of gas supply. The existing gas supply from PT ExxonMobil Indonesia is only enough to meet its LNG export commitment and supply the gas needs of the state owned fertilizer producer PT Pupuk Iskandar Muda that operates two fertilizer plants. (*)