JOB Pertamina-PetroChina, ExxonMobil agree to share production of Sukowati field

State oil and gas company PT Pertamina, Chinese oil firm PetroChina, and ExxonMobil Indonesia have agreed to share oil production from their overlapping concession areas in the Sukowati oil field in Tuban, East Java, Bisnis Indonesia reported on Tuesday.

"Finally, JOB Pertamina-PetroChina and ExxonMobil have agreed on a production sharing split of 80 percent and 20 percent. ExxonMobil, the operator of the Sukowati oil field will receive 80 percent," said Zanial Achmad, the deputy of the chairman of BP Migas, the government's body in charge of oil and gas production and exploration activities.

Pertamina and PetroChina jointly operate the Tuban oil block through a joint operating body (JOB). Around 15 percent of the Sukowati oil reserves lie in this block, while the remainder in the Cepu Block operated by ExxonMobil Indonesia.

According to Zanial, the production sharing formula is based on the fact that the larger parts of the Sukowati oil field overlap with ExxonMobil's Cepu oil block. The two oil companies would also share the production costs at the Sukowati oil block under a special arrangement, which would be signed by the two companies, he added.

The agreement finally ended the conflicts between the oil operators in the Sukowati field. ExxonMobil has recently urged Pertamina to end the production activities of JOB Pertamina-PetroChina until an agreement was made.

JOB Pertamina-PetroChina began production activities in August with a production capacity of 7.000 barrels in August. (*)