Medco able to maintain production in Tarakan

PT Medco E&P Indonesia, a subsidiary of IDX-listed PT Medco Energi Internasional, is able to maintain production stability at Tarakan block in North Kalimatan with efficient operating costs.

The firm can now operate the block more efficiently by optimizing field activities; increasing well capacity by carrying out workover programs and installing Artificial Lift ESP pumps; and servicing production wells, the firm said in a statement.

The block has been producing 1,900 barrels of oil equivalent per day (boepd) since the end of last year. This is a positive achievement in view of the fact the global natural depletion rate of oil reserve now stands at between 20-25 percent per year.

The firm delivers gas from the block to household consumers and the power plant owned by state-owned PT Perusahaan Listrik Negara (PLN) in Tarakan. There are 3360 households in two districts of the city now receiving gas from Medco?s Tarakan block.

The block?s reserve has much declined since Medco took over the operatorship of the block from state owned oil and gas firm PT Pertamina back in 1997. The firm drilled two exploration wells and three development wells in 2013 and 2014 in order to maintain the block?s production.

Thanks to efficiency program, the firm was able to keep the block?s lifting cost at below US$20 per barrel, well below the current oil prices of $55-$60 per barrel.

?Tarakan block can still operate economically,? Nugraha Alibasah, Operation Manager of Medco E&P at Tarakan Block, said.

Editing by Johannes Simbolon