PEP allocates higher capex next year

Upstream company PT Pertamina EP (PEP), a subsidiary of state-owned oil and gas company PT Pertamina, has allocated around US$700 million for capital expenditure next year, higher than the planned $636 million for this year, Bisnis Indonesia reported on Thursday.

The paper quoted PEP President Director Nanang Abdul Manaf as saying that the company will be more aggressive in carrying out exploration and exploitation activities covering 70 development wells, 14 exploration wells, and continuation of a number of seismic activities such as in Klamono, Tanjung, Jirak and Pendopo fields.

He said that oil price is anticipated to recover to more than US$50 per barrel next year.

?For capex 2018, it will be around $700 million. Of this year?s prognosis of $636 million, about 68 percent has been realized as per September because we?re quite aggressive in the months toward the end of the year such as adding rigs and increasing activities. We?re optimistic for next year,? Nanang said.

He said that PEP will continue to implement enhanced oil recovery program next year as many of its oil fields are aging such as Rantau, Tanjung, and Jatibarang fields.

He estimated that oil production until end of this year is estimated at around 78,000 bpd, and gas production of 778 mmscfd. He said the company is seeking to increase oil production next year to 83,000 bpd, while gas around 790 mmscfd. (*)