Medco to launch takeover move this month

PT Medco Energi International Tbk will realize its plan to take over four oil and gas oil fields in Aceh, Riau and South Sulawesi this month, marking the start of the company's massive expansion plan, Bisnis Indonesia reported on Wednesday.

The company's finance director Sugiharto said in Jakarta on Tuesday that Medco would acquire a 50 percent interest in the Aceh based oil and gas field and majority interest in the two oil and gas fields in Riau and minority interest in the oil and gas field located in South Sulawesi.

He, however, refused to unveil the amount of the acquisition plan. But he said that the takeover of the four oil and gas fields would be financed by the proceeds from the company's bond offering recently.

According to him, the company's spending for the acquisition move is expected to reach about US$200 million next year, an equivalent to its total operation cost which is also estimated to reach US$200 million in the same year.

Sugiharto said that the acquisition of the four oil and gas fields, which have all producing activities would bring a positive contribution to the company's production which reaches 65,000 barrels of oil per day and 100 million cubic feet of gas per a day.

The company took over last month an oil gas field located in South Sumatra for US$2.6 million as part of the company's massive expansion plan. The company plans to invest about US$23.3 million for the Merangin field which has yet to start production. (*)