Pertamina's SK 305 block to begin production in 2009

State-owned oil and gas company Pertamina will begin production activities at its SK 305 oil block off Sarawak, Malaysia early 2009, with a production level of between 5,000 and 6,000 barrels per day.

Pertamina's upstream Vice President for Asia and South America Ventures, Doddy Priambodo said in Jakarta Friday that the peak production at the oil block was expected to be achieved by 2010 with an output level of 20,000 barrels per day. The release was issued to correct earlier statement by Pertamina’s Upstream Director Sukusen Soemarinda that the block would start production in the second quarter of 2008.

Doddy said that the new exploration system used by Pertamina and partners in the D sub-block had indicated a significant result, with a success ratio of 83 percent in which from the six wells being drilled, the company had been able to make five discoveries of oil and gas.

He said that in order to increase the oil reserves from the SK 305 block, Pertamina and its partners through joint operatorship body called PCPP had also conducted exploration activities at the C sub-block.

In the C sub-block, the partnership had discovered oil and gas flowing of 1,000 barrels of oil per day and 2 million standard cubic feet per day, respectively. The production is expected to begin 2010.

Doddy said that Pertamina should allocate at least US$30.2 million this year and another $80.75 million in 2008 for the development of the D and C sub-blocks.

According to Doddy, Petronas also had offered PCPP to also operate its 4Q-9 onshore block located in the southern part of the SK 305 block. "The administrative process for this cooperation is underway," he said.

The block is operated under the Joint Operating Company (JOC) scheme, where Petronas has a 40 percent stake, while Pertamina and PetroVietnam have a 30 percent stake each.

Block SK305 is located in water depth of 150 metres in Balingian, offshore Sarawak, covering an area of about 16,400 sq kilometres. (godang)