Business

Chevron kicks off Duri
field expansion in Sumatra

The nation’s largest crude oil producer PT Chevron Pacific Indonesia (CPI) broke ground on Thursday on the North Duri Development (NDD) Area 13 project at its Duri oil field in Sumatra.

Chevron’s Jeff Shellebarger, the managing director of the IndoAsia business unit, said on Thursday the NDD Area 13 project was expected to add 17,000 barrels of oil per day (bpd) to the Duri field’s total oil output at its peak production.

The US$500 million project will consist of 539 new wells, including 358 producing wells, 145 steam injection wells and 36 temperature observation wells.

“The Duri field is a remarkable success story for both Chevron and Indonesia. With the continued application of advanced technology and investment, we have been able to extend the life of this field and increase the amount of oil recovered,” Shellebarger said in a statement made available to The Jakarta Post.

The Duri oil field contributes half of CPI’s oil production, according to upstream oil and gas regulator BPMigas. In total, the US-based energy giant’s local subsidiary accounts for around 40 percent of Indonesia’s annual oil output.

This year, CPI is expected to contribute 343,212 bpd to the country’s oil production, which is projected to reach 870,000 bpd.  

The NDD Area 13 project follows the NDD Area 12 project, which the firm completed in 2009 and which added 40,000 bpd the Duri field’s production.

Separately, BPMigas spokesman Hadi Prasetyo told the Post in a telephone interview that NDD Area 13 was among 11 new oil and gas fields the supervisory body had relied on to boost next year’s production.

“We are hoping peak production of NDD Area 13, which is expected to be 17,000 bpd, can be reached in the second semester of 2013,” he said.

Aside from the NDD Area 13 project, the supervisory body expected France-based Total E&P Indonesia’s new South Mahakam oil field to begin production in November.

“As for the South Mahakam oil field, we are hoping it can add around 4,900 bpd to the country’s oil production,” he said.

Indonesia, a former member of the Organization of Petroleum Exporting Countries (OPEC), is currently struggling to boost oil production amid its aging oil fields. The nation joined OPEC in 1961 but left in 2008 after it became a net oil importer.

The nation’s production fell to 970,000 bpd in 2008, far below the 1.6 million bpd it produced in 1996. Southeast Asia’s largest economy has experienced a further decline in oil production in the past few years, falling from 954,000 bpd in 2010 to 898,000 bpd in 2011.

As of September, Indonesia’s oil production stood at 870,000 bpd due to unplanned oil field shutdowns and aging oil fields, far below the initial target of 930,000 bpd as stated in this year’s state budget.

BPMigas expects to add 44,900 bpd for next year’s target from new oil fields as well as by pushing state energy firm PT Pertamina to utilize enhanced oil recovery programs to optimize the oil-rich Cepu block’s production.  

The regulator expects oil production to reach 900,000 bpd next year.

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