Medco returns Madura block to government

Medco E&P Indonesia, the upstream unit of JSX-listed energy firm Medco Energi Internasional Tbk, has returned its Madura block to the government after finding the block was not economically feasible for further development.

 

"The exploration permit has expired. We have carried out a number of exploration activities but the results were not economically feasible for further development," the company's corporate secretary Andy Karamoy.

Medco had spent about US$16 million of the $63 million committed for the exploration activities in the block, Andy said.

 

Andy said that Medco had asked for the extension of the exploration permit to the government but the request was rejected.

 

The contract for the development of the Madura block was signed in May 1977, with a 10-year exploration permit. Medco owns a 65 percent interest in the oil block with Pertamina owning the remaining 35 percent. (godang)