Business

Exxon’s new boss urged
to be more ‘flexible’

Upstream oil and gas regulatory special task force SKKMigas has approved the appointment of Jon M. Gibbs as the new country manager of ExxonMobil Indonesia replacing Richard J. Owen, who will become the country head of ExxonMobil Australia.

SKKMigas secretary Gde Pradnyana said in Jakarta on Tuesday the regulatory watchdog would give the Chicago-born Gibbs, who joined American giant ExxonMobil in 1993, a little time to adjust to his new position.

“We hope Gibbs can deliver on all the deals we have previously made with ExxonMobil. In addition, we want him to be more flexible and down-to-earth in dealing with officials as well as other Indonesians,” he said, adding that Gibbs needed to be “more supple and reliable” than his predecessor in dealing with the firm’s business matters in Indonesia.

Former country director Owen, a chemical engineer with 30 years of experience with ExxonMobil, will replace John Dashwood as the country head of ExxonMobil Australia. In January this year, SKKMigas refused to extend Owen’s tenure as the country head of ExxonMobil Indonesia.

Owen’s relationship with the Indonesian government turned sour following dissatisfaction by government officials of the executive’s performance amid delays in the much-anticipated ExxonMobil-operated Cepu oil block in East Java.

President Susilo Bambang Yudhoyono’s administration is banking on the Cepu block to boost the nation’s crude oil output to around 1 million barrels per day in 2014, in conjunction with the election year that will mark the end of Yudhoyono’s leadership after two terms in office.

Southeast Asia’s former sole representative at the Organization of Petroleum Exporting Countries (OPEC), Indonesia currently produces only around 840,000 barrels per day (bpd) of oil, far less than its peak output of 1.6 million bpd
in 1995.

The block’s Banyu Urip field project, whose peak production is estimated to be around 165,000 bpd of crude oil, was expected to be completed in May 2014 with the aim of boosting the country’s dwindling oil production.

Under Owen’s tenure, however, the project was pushed back to September 2014.

Gde, previously SKKMigas’ operations deputy, attributed the company’s failure to communicate with landowners around the Cepu block as one of the main reasons behind the delays.

“The clock is ticking, yet those expatriates continue to receive paychecks while the project continues to be delayed. This may not have been entirely Owen’s fault but as he was the head, we decided not to extend his contract at the time,” said Gde.

“So, we want Gibbs to be better in leading ExxonMobil here.”

ExxonMobil’s decision to cancel its plan to sell shares in three companies associated with gas and liquefied natural gas (LNG) operations in Aceh was also cited as one of the reasons for the government’s discontent with Owen.

Separately, ExxonMobil Indonesia spokesman Erwin Maryoto said that throughout his career, Gibbs, whose educational background is in petroleum engineering, has held various technical and managerial positions in engineering, operations and commercial fields.

“His previous overseas assignments include Nigeria and Angola. He also served as an adviser to the upstream senior vice president of the ExxonMobil Corporation at its headquarters in the US,” said the firm’s spokesman. Gibbs was
not available for comment on Tuesday evening.

The Cepu block is ExxonMobil’s single major project in Indonesia at the moment.

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