S

antos Indonesia, subsidiary of Australia-based Santos, plans to shut down all operations at the
Oyong field of the Sampang block near Madura, East Java, for maintenance in June.

The company’s manager of operations, Jhon Ginting, revealed on Thursday that the shutdown could take seven days, but there was no decision yet on the precise date for the shutdown. During the maintenance activities, all gas and oil production would be temporarily stopped, he added.

“Our supply to Indonesia Power’s power plant in Grati [East Java] will be stopped for the seven-day maintenance,” he told reporters at a media gathering at Santos Indonesia’s office in Jakarta.

To prevent any losses, Santos would try to persuade Indonesia Power, a subsidiary of state power utility PT Perusahaan Listrik Negara (PLN), to also conduct maintenance activities simultaneously, Jhon said.

“This plan is still being discussed,” he emphasized.

The Oyong field delivered 30 million standard cubic feet per day (mmscfd) to the Grati power plant through a 14-inch pipeline spanning 60 kilometers from the field to an onshore gas processing plant in the Lekok subdistrict of Pasuruan regency, East Java.

The field began oil production in September 2007. Currently, its oil output is 3,500 barrels per day (bpd). Gas production was a more recent development, starting in September 2009.

Santos Indonesia president director Marjolijn Wajong said her company would continually develop its business in the country.

In addition to the Oyong field, the Sampang block also contains the Wortel field, which kicked off gas production in February this year. The 50 mmscfd of gas produced at the field is distributed to Indonesian Power (30 mmscfd), industries in Sampang (17 mmscfd) and Pasuruan (3 mmscfd).

The shareholders for the Sampang block comprise Santos (Sampang) Pty. Ltd. (45 percent), Singapore Petroleum Sampang Pty. Ltd. (40 percent) and Cue (Sampang) Pty. Ltd. (15 percent).

Santos operates two fields, Maleo and Peluang, in the Madura Offshore block. The Maleo field was discovered in 2002, with production commencing in 2006. Around 100 mmscfd of gas from the field is currently sold to state gas distributor PT Perusahaan Gas Negara (PGN) under a gas sales agreement signed in 2005.

Marjolijn reported that currently, the company was doing an engineering review at the Peluang field to identify equipment needs and how much investment might be required. The plan of development (PoD) for the field was approved in 2011.

“We hope the review can be completed in June this year,” she said.

The field is estimated to be capable of producing 25 mmscfd of gas starting in January 2014. As many as 5 mmscfd will be utilized to support the government’s program to switch from oil-based fuels to gas in the transportation sector.

“We’re also currently marketing the remaining 20 mmscfd of gas from the Peluang field because the field can’t be developed unless the buyers have been found,” Marjolijn explained.

Shareholders at the Madura Offshore block comprise Santos (Madura Offshore) Pty. Ltd (67.5 percent), PC Madura Ltd (22.5 percent) and PT Petrogras Pantai Madura (10 percent).