MedcoEnergy starts development of area-47 Libya

IDX-listed PT Medco Energi Internasional, through its subsidiary Medco International Ventures Limited, has established the joint operating company (JOC) with its partners, the National Oil Corporation of Libya (NOC) and the Libyan Investment Authority (LIA).

Following the company?s success in exploration program (18 out of 20 wells were discovery well - a success rate of 90 percent), the commerciality declaration of some of oil and gas fields out of 16 discovery fields in the Area 47 was given to the company on 14th December 2011, the company said in a press statement on Monday.

Subsequently, the JOC is established to act as the operator for development and production phases of the Area 47. In this JOC, namely Nafusah Oil Operations B.V., MedcoEnergi will own an interest of 24.5 percent, while NOC and LIA will own interest of 51 percent and 24.5 percent respectively.

Additionally, the management committee (MC) that oversees both Medco International Ventures Limited as the Operator of the Exploration/Appraisal Phase and Nafusah Oil Operations B.V. as the operator of the development / production phase has obtained new members.

The new MC membership that consists of four officer members - of which two persons are from NOC, one person is from LIA and one person is from MedcoEnergi, were formally appointed on 25th February 2013.

The production from Libya Area 47 is envisaged to start in 2016 with an ultimate production plateau of 50,000 BOPD. The development project is planned to monetize about 300 MMBOE of recoverable reserves from six (6) out of sixteen (16) oil and gas fields that were discovered so far in Area 47.

Total capital investment is estimated at about US$ 900 million, comprising of US$ 280 million for drilling and US$ 620 million for surface facilities. MedcoEnergi?s portion will be approximately US$ 220 million.

Lukman Mahfoedz, President Director & CEO of MedcoEnergi, said that the development of Area 47 Libya sets an important milestone of Libya?s oil production from a new field development, and contributes significant income to the country as well as to the Company.

?We are very excited for the remaining 10 fields that are being appraised right now for the next stage of development,? he said.

Editing by Benget Besalicto Tnb.