Indonesia's Mahakam Gas Liftings Only Reach 87 Percent of January Target

Natural gas liftings from Indonesia's offshore Mahakam oil and gas block were only 87 percent of their target for January 2018. (Reuters Photo/Gary Cameron)

By : Wilda Asmarini | on 2:23 PM February 09, 2018
Category : News

Jakarta/Tokyo/London/Singapore. Natural gas liftings from Indonesia's offshore Mahakam oil and gas block were only 87 percent of their target for January 2018, a spokesman from Indonesia's upstream oil and gas regulator SKK Migas told Reuters on Thursday (09/02).

This was equivalent to 969 million standard cubic feet per day (mmscfd), well below the initial target of 1,110 mmscfd for 2018 and a sharp drop from the estimated 1,255 mmscfd of gas lifted from the block in 2017.

The regulator has reminded the country's state energy company Pertamina to fulfil its oil and gas lifting target, spokesman Wisnu Prabawa Taher told Reuters.

Pertamina took over as the block's main operator on Jan. 1, 2018 from Total E&P Indonesie, a unit of French major Total, and Japan's Inpex.

The company's upstream director Syamsu Alam told a news conference in November last year that it is concerned about managing production and plans to spend $700 million on the upkeep of the block to maintain output.

The Mahakam block's oil liftings in January were 31,053 barrels per day (bpd), or 64 percent of the target for last month, SKK Migas spokesman added.

Gas deliveries from Mahakam to Indonesia's Bontang liquefied natural gas (LNG) plant, one of the largest in the world and operated by Pertamina unit Badak NGL, averaged 966 mmscfd, or 87 percent of its target, as of Jan. 31, he said.

"Fulfilling this target is very important, especially for natural gas because Mahakam Block supplies gas to the Badak LNG plant in Bontang," Taher said.

"If gas supply to the LNG plant is under target, delivery of LNG will not fulfil commitment (to buyers) that has been agreed upon."

Pertamina's Alam told Reuters there was no disruption of LNG deliveries to its customers while Badak's chief executive declined to comment.

The Mahakam block is the main source of natural gas for Bontang.

So far, several buyers of LNG from Bontang said their cargoes have not yet been affected.

The number of buyers holding LNG contracts from the plant and overall LNG volumes exported from the plant have declined over the last few years due to falling production, a Japanese buyer said.

So the impact is likely to be small, he added.

Reuters

 

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