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oil, would be delivered to market via a planned that it is already reported to have objected to the
floating production, storage and offloading appraisal drilling campaign.
(FPSO) unit. Previously drilling was suspended in 2017 at a
Wheaton said that total capital expendi- Vietnamese offshore block in waters that Beijing
ture requirements for the projects depended claimed overlapped with Chinese territory. By
on whether the FPSO would be leased or pur- contrast, Indonesia appears to be taking a firmer
chased, but added that in a case where the FPSO line, based on comments made to Reuters by
is leased, capex costs could amount to $6-8 per Indonesian lawmaker Muhammad Farhan,
boe. Overall costs including capex and operat- who sits on the parliament’s national security
ing expenditures in this scenario could amount committee.
to $20-22 per boe, he said. “Our reply was very firm, that we are not
Harbour is targeting the development of over going to stop the drilling, because it is our sov-
100mn boe on a gross basis, with peak output ereign right,” Farhan was quoted by the news
of 40,000-50,000 boepd. Gas is anticipated to service as saying.
account for around 55%, while liquids make up According to Farhan, the Indonesian govern-
the other 45%. ment downplayed the standoff publicly in order
Russia’s Zarubezhneft is a partner in the to avoid exacerbating tensions. But sources
project. familiar with the matter told Reuters that China If this
had made “repeated” demands that Indonesia
Next steps stop drilling. complicates
Wheaton said Harbour had already initiated the If this complicates Harbour’s plans for Tuna, Harbour’s plans
technical and commercial work fronts for Tuna, the company has another project in a different
and was engaging with SKKMigas to establish region offshore Indonesia, which Wheaton for Tuna, the
the timeline to a final investment decision (FID) described as an “exciting matter” in his pres-
on the project. He added that there had been entation. Harbour has a 40% operated interest in company has
“very positive support” indicated thus far by the the Andaman II prospect in the Andaman Sea
regulator. off Northern Sumatra, in partnership with BP another project
An SKKMigas planning deputy, Benny Lubi- and Mubadala. The partners have contracted a in a different
antara, said separately prior to Harbour’s capital drillship to spud the Timpan-1 well on the pros-
markets day that the company and the regulator pect next year, which is targeted for March or region offshore
would start discussions and studies to support April.
the plan of development (PoD) for Tuna in Harbour expects the area to be gas-prone Indonesia.
January. and estimates that the well, including setting up
Harbour believes that an FID in the first half remote logistics in around 1,200 metres of water,
of 2023 is realistic, followed by the start of pro- will cost $80-85mn on a gross basis.
duction in 2026. “Timpan really could be a significant play
The complicating factor, though, is how Bei- opener in the region,” Wheaton said. “But of
jing will view a development in waters that it course nothing in exploration is a given but we
perceives to be within Chinese territory, given proceed with good confidence.”™

Week 50 17•December•2021 www. NEWSBASE .com P7