PetroChina calls for an immediate end to Jabung block seal off
Tuesday, May 28 2013 - 02:01 AM WIB
The company warned in a statement issued Tuesday that if the current cordon at the wells is not immediately lifted, it would have to shut down the wells to ensure safety and environmental protection, which would cause oil production loss of 433 bpd and gas 11,011 mmscfd, worth combined financial losses of US$220,166 per day.
?The seal off has caused us to be unable to carry out routine maintenance inspection and monitoring of the oil and gas wells, thus causing us to be unable to ascertain the safety of the operation of the wells. We hope that would not be forced to shut down the wells, because such a move would lead to oil and gas production loss, which would cause (financial) loses to the state,? said Novie Latanna, Communications Manager of PetroChina Int Companies in Indonesia.
The 14 wells have already been in production since PetroChina acquired the Jabung block in 2002.
The East Tanjung Jabung regency administration sealed off the 14 wells on May 24 reportedly because PetroChina has yet to obtain the necessary location permit for the wells from the local administration.
Elsewhere, Novie said that regarding the request of the East Tanjung Jabung administration to allocate 5 mmscfd of the Jabung block gas output for the regency, which may be part of the reason for the seal off, Novie said that the SKK Migas, the upstream oil and gas authority, has approved the demand, and that a due diligence process on the local company appointed by the administration to absorb the gas is currently ongoing.
If everything goes well, the gas sale and purchase agreement could be signed in November of this year, Novie said.
She added that PetroChina expected the local administration to also quickly issue the location permit for the Jabung block as the company has applied for it since nine months ago.
Editing by Reiner Simanjuntak