Walio crude exports shift from Japan to China: Report

Majority of Indonesia's light, sweet Walio crude is now being exported to China under a fresh six-month term deal from October 2002 to March 2003, after Japanese trader Itochu's contract expired in September, an equity producer source said Wednesday as reported by Platts news.

Indonesia's Salawati Basin block in Papua, which pumps Walio, is now operated by Chinese upstream player PetroChina. This block was among six properties acquired by PetroChina through its purchase of Devon Energy's Indonesian assets in April this year. The Chinese player completed the takeover formalities from Devon in the third quarter of this year.

Walio output remains stable around 11,500 barrels per day (BPD), the equity source said. Some 20 percent of Walio will continue to be exported to Japan, by Itochu subsidiary CIECO, which also holds equity in the Salawati block.

The October-March term Walio sales deal is with China Oil, and is fetching a better premium than the earlier contract with Itochu, sources said.

China Oil is paying around cents 50 per barrel premium to the Walio ICP [official Indonesian Crude Price], compared with 43 cents paid by Itochu, they said.

Meanwhile, crude output from two other producing blocks under PetroChina--Geragai crude from Jabung block in Central Sumatra and Mudi crude from Tuban block in East Java--remains stable, equity sources said.

Geragai is currently averaging 19,000 BPD (21,000 barrels of oil equivalent per day including LPG), while Mudi is stable around 10,500 BPD, they said. (*)