PHE sets capex at $686m this year, lower than last year

PT Pertamina Hulu Energi (PHE) has budgeted US$686 million in capital expenditure (capex) this year, down from $840 million in 2015, state owned oil and gas firm PT Pertamina (Persero) said in a press release on Friday.

PHE?s President Director Gunung Sardjono Hadi said in the statement that the capex was set in the middle of last year when the oil price hovered at around $50 per barrel. In view of the current market condition where oil prices have plunged to around $30 per barrel, PHE will review the capex prior to execution

?Our first priority in making investment is HSSE (Health, Safety, Security and Environment), in which PHE recorded no fatality in 2015. Next (priority) is drilling that will increase oil and gas production,? he said.

Based on working plan, PHE will carry out 2D seismic survey on 3,245 km, 3D seismic on 513 sq km, aside from drilling ten oil and gas exploration wells and seven unconventional exploration wells.

The firm targets production at 63,900 bpd for oil and 652 mmscfd for gas this year, a 4 percent decrease from last year?s realized production. The decrease will happen due to a sharp decline in the production of some subsidiaries, Gunung said, while providing no details.

Editing by Johannes Simbolon