Pertamina moves to acquire Verenex's Libya oil field

Alfian, The Jakarta Post, Jakarta | Sat, 11/29/2008 11:32 AM  

PT Pertamina is moving ahead with an expansion plan, with the state oil and gas company in talks with Verenex Energy Inc. to buy the Canada-based firm's stakes in an oil field in the Ghadames Basin, Libya. 

The field, known as Area 47, is operated by Verenex and Indonesia's largest publicly listed oil company, PT Medco Energi, with each holding 50 percent of the interest. 

"Verenex may pull out from the block. As the drilling has been done, we think why not to enter into this block," said Pertamina's upstream director Karen Agustiawan Friday. 

Karen said Area 47 may begin production in 2011 with an initial production estimated at 50,000 barrels of oil per day. 

She added that the block, if the talks were successful, would be the third Pertamina block in Libya. "We already own two blocks in Libya and are looking forward to see Libya as one of our bases overseas." 

Medco and Verenex won rights in 2005 to explore the basin for 30 years. The area contains about 2.15 billion barrels of oil equivalent according to a best estimate study as of Sept. 20, Medco said on Nov. 7, as reported by Bloomberg. 

Libya, a member of the Organization of Petroleum Exporting Countries (OPEC), has 41.5 billion barrels in proven oil reserves and produced more than 1.75 million barrels a day in October. 

Karen said Pertamina has yet to decide the portion of the stakes it would acquire. "We are still in talks with Verenex. We don't know yet whether we will enter the block alone or with partners," she said. 

Meanwhile, Pertamina is also getting good news on the domestic front. 

The company, through its subsidiary, PT Pertamina EP, is developing an oil and gas well in Pondok Tengah, Bekasi, West Java. 

In an early trial on Nov. 24, PT Pertamina EP extracted 3,447 barrels of oil per day and 6.7 million cubic feet gas per day from the well, PT Pertamina EP's president director Tri Siwindono said. 

Pertamina expects to produce an average 154,000 barrels of oil per day in 2008, up from 143,000 barrels per day in 2007.