Page 10 - AsianOil Week 01 2021

AsianOil SOUTHEAST ASIA AsianOil

SKK Migas approves Repsol’s

plan for Kaliberau gas project

PROJECTS & INDONESIAN upstream watchdog SKK Migas
COMPANIES has apparently settled its differences with Spain’s
Repsol over the onshore Kaliberau natural gas
project, signing off on proposed development
plan last week.
The two had been struggling to find a middle
ground on pricing for the field’s production, with
the country’s regulated gas price cap of $6 per
mmBtu ($165.96 per 1,000 cubic metres) a key
sticking point.
SKK Migas said on December 29, however,
that it had approved the Spanish major’s $282mn
initial plan of development (POD) for the field,
which lies in the Sakakemang block onshore
South Sumatra. Under the plan Repsol, along
with partners Petronas and Mitsui Oil Explo-
ration Co. (MOECO), will redrill the KBD-2X
well, drill a new production well and tie the field resources, is expected to produce 85mn cubic
back to the neighbouring Corridor block. feet (2.41mn cubic metres) per day of gas at its
Petronas owns 45% of Sakakemang and peak. Sales over the field’s anticipated 15-year
MOECO holds 10%, while ConocoPhillips lifecycle are projected to reach 287.7bn cubic
operates Corridor with 54% and Pertamina feet (8.15 bcm).
owns the remaining 10%. However, under a Susana said tying the field back to the Cor-
20-year extension agreement for the Corridor ridor block was part of a plan aimed at “mon-
contract, Pertamina’s interest will rise to 30% in etising gas fields near existing gas distribution
2024 while ConocoPhillips will own 46% and infrastructure to meet domestic gas demand
Repsol will hold 24%. quickly and accurately”. Kaliberau lies 25 km
“The [company] is expected to immediately from the Grissik plant, which gathers and pro-
execute the plan to start production as soon as cesses output from Corridor.
possible,” local daily The Jakarta Post quoted Susana added: “Experts have said that poor
SKK Migas spokeswoman Susana Kurniasih as gas infrastructure had limited Indonesia’s gas
saying on January 4. demand and thus, limited investors’ appetites to
The field, estimated to hold 2 trillion cubic explore new gas reserves.”
feet (56.64bn cubic metres) of recoverable News of the approval came ahead of SKK
Migas’ disappointing but largely unsurprising
announcement that the country’s gas production
had fallen short of government targets last year.
Indonesia produced 5.46 bcf (154.63 mcm)
per day of gas on average in 2020, short of the
government’s 5.56 bcf (157.46 mcm) per day tar-
get. Indonesian oil production, however, slightly
exceeded the government’s target of 705,000 bpd
at was 706,000 bpd.
Indonesia has set a target of producing 12 bcf
(339.84 mcm) per day by 2030 as well as 1mn
bpd of oil. However, the country has several
challenges to overcome in the both the short
and mid-term before it can hope to achieve this
target.
Chief among these is addressing foreign
investors’ diminished confidence in the country’s
upstream. Several years of resource nationalism,
coupled with a shifting regulatory landscape, has
left many foreign investors wary about commit-
ting to the country. This situation only deepened
with the collapse of oil and gas prices last year,
amid the COVID-19 pandemic which continues
Image: SKK Migas to create volatility in commodity markets.™

P10 www. NEWSBASE .com Week 01 07•January•2021