Release: EMP shuts down gas production at Kangean PSC

Jakarta. November 23. 2006. Indonesian oil and gas company, PT Energi Mega Persada Tbk. (ENRG), today reported that its operating subsidiary, EMP Kangean Ltd., shut down gas production at the Pagerungan field in the Kangean PSG late last evening on November 22, 2006. The shut down is a result of a pipeline failure in the East Java Gas Pipeline which has unfortunately resulted in some fatalities and injuries.

EMP Kangean Ltd. has shut down 9 onshore production wells in the Pagerungan Field. Seven offshore higher water content gas wells are still flowing to the Kangean gas processing facility, and the resultant gas production is being flared.

The pipeline failure happened near the Banjarpanji well site at Sidoarjo, East Java at 8.11 pm on November 22. The East Java Gas Pipeline is owned and operated by the Indonesian state oil and gas company Pertamina.

Gas from the Kangean PSG currently serves two major customers in East Java: PT Petrokimia Gresik and PT Perusahaan Listrik Negara (PLN). The gas production rate prior to the incident was 64 million cubic feet per day. EMP Kangean Ltd. is working hard with all stakeholders to ensure a timely re-establishment of supply to its important East Java customers. ENRG owns a 100% working interest in the Kangean PSC. (end of release)