Indonesia inks oil contracts to boost reserves http://today.reuters.com/news/articlebusiness.aspx?type=OILPRD&storyid=2007-01-16T074803Z_01_B453710_RTRIDST_0_INDONESIA-OIL-EXPORATION.XML&from=business
Tue Jan 16, 2007
JAKARTA, Jan 16 (Reuters) - Indonesia signed new production sharing contracts with three global energy firms -- ConocoPhillips (COP.N: Quote, Profile , Research), CNOOC Ltd. (CEO.N: Quote, Profile , Research) and Premier Oil (PMO.L: Quote, Profile , Research) -- on Tuesday to boost reserves, the oil minister said.
Asia-Pacific's only OPEC member has been offering new exploration rights to try to stem a steady decline in oil production that has threatened its status as an exporter.
Indonesia has struggled to maintain output as the country has failed to tap new oilfields fast enough.
ConocoPhillips is in a joint venture with Statoil ASA (STL.OL: Quote, Profile , Research) of Norway to explore 5,086 square kilometres (1,964 square miles) of the Kuma block off west Sulawesi.
The oil contractor will get 35 percent if oil is found in the Kuma block and 40 percent of gas, while the rest will go to the government.
Indonesia also signed an oil contract with CNOOC for the onshore Batanghari block in central Sumatra. The oil contractor will get 20 percent of production if oil is found and 40 percent of gas in Batanghari.
"We will know whether there is oil and gas in those areas after they conduct exploration. However, our expectation is that they will find oil or gas," Purnomo Yusgiantoro told reporters.
Indonesia also signed a contract with Premier Oil for the onshore and offshore Buton block in southeast Sulawesi. The contractor will get 25 percent of oil production and 40 percent of gas.
Indonesia says it has about 8.6 billion barrels of proven and potential oil reserves and 182 trillion cubic feet of gas.
© Reuters 2007. All Rights Reserved.