PHE sets capex at $686m

By Febry silaban

PT Pertamina Hulu Energi (PHE), a subsidiary of state-owned oil and gas company PT Pertamina (Persero), plans to spend US$686 million in capital expenditure this year.

"But, because of the drop in oil prices to around $30 per barrel, we are still going to review the capex plan," President Director Gunung Sardjono said in Jakarta.

He said that the spending budget was set at the middle of last year with reference to the price of oil according the 2016 state budget of $50 per barrel. However, the current price of oil has been well below that assumption, falling to around $30 per barrel.

He acknowledged that this capex plan was lower than last year's budget of $840 million. However, the realization of the budget was only 63.2 percent, or $531 million. The low uptake is caused by the company?s efficiency drive, and delay in some drilling activities, he said.

Editing by Reiner Simanjuntak