PHE still in talks with partners on the fate of 8 CBM working areas

By Febry Silaban

Petromindo

PT Pertamina Hulu Energi (PHE), an upstream subsidiary of state-owned oil and gas firm PT Pertamina, said it is still in the process of reviewing and negotiating with its partners in eight CBM working areas over proposed plan to relinquish its interest in the blocks.

"We're still doing studies and negotiations with our partners in each CBM block," President of PHE Gunung Sardjono said on Thursday.

Last year, the company unveiled plans to relinquish operatorship over eight of its total 14 coal bed methane (CBM) working areas as they?re considered to be not economically feasible.

Gunung said that the eight CBM working areas have gas production rate of less than 0.1 mmscfd, much lower than the average 0.3-0.5 mmscfd in Australia. He said that the company will first try to sell the assets to other companies, and if no one is interested, it would return them to the government.

Gunung said that PHE has spent US$30 million in the eight CBM working areas, which have reached the exploration or dewatering stages. In addition to low output concern, PHE is still using conventional technology in the CBM exploration work, thus creating a huge cost.

Among of the CBM working areas to be released by PHE are Tanjung, Sangatta, and Muara Enim.

Editing by Reiner Simanjuntak