Medco eyes EEX? stake in E. Java oilfield

Jakarta Stock Exchange listed oil and gas company PT Medco Energi Internasional is in the process of buying an onshore oil field in Tuban, East Java, from US independent EEX corp., a Medco official said Friday.

Muntazar, a Medco spokesperson corrected earlier statement made by company?s Chief Financial officer that the company is buying Australia?s Energy Equity Corp. asset in East Java.

Muntazar said the two companies signed a preliminary agreement last week. The deal, however, is subject to conditions, including approval from minority shareholders.

Medco?s CFO Sugiharto declined to disclose the value of the transaction - giving only a range of $20m to $40m - as the listed company must report it first to the Indonesian capital market watchdog Bapepam.

EEX has 25 percent working interest in Tuban joint operating body (JOB), while Devon Energy, who is also in the process of selling its Indonesian assets, has 25 percent. State oil and gas firm holds the remaining 50 percent.

Tuban JOB currently produces some 10,000 barrels per day of crude and had recently discovered another significant oil reserve in the Sukowati field.(alex/godang)