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Jakarta Post

Lapindo Brantas to resume Sidoarjo drilling

  • Indra Harsaputra

    The Jakarta Post

Sidoarjo, East Java   /   Thu, January 7, 2016   /  06:18 pm

Oil and gas company PT Lapindo Brantas, controlled by the family of businessman and Golkar Party chairman Aburizal Bakrie, plans to redrill a gas well near the center of a mudflow in Porong, Sidoarjo, East Java, while compensation to mudflow victims has not yet been fully disbursed.

Hundreds of police officers and security guards were seen on Wednesday guarding the Tanggulangin 1 well in Kedungbanteng subdistrict, Tanggulangin district, Sidoarjo, which is located some 5 kilometers from the center of the mudflow in Porong.

The company'€™s spokesman Arief Setya Widodo said the drilling activity at Tanggulangin 1 would be for gas rather than for oil, as had been the case with the Banjar Panji-1 well. The Banjar Panji-1 well is believed by many to have caused the 2006 flow of hot mud that inundated thousands of houses in Porong.

'€œWe will drill some 3,000 feet or a kilometer deep here,'€ Arief told The Jakarta Post.

At Banjar Panji-1, he said, the drilling had gone 3.5 kilometers deep, while in Tanggulangin, the drilling would only need some two to three weeks to complete.

He said the company was currently conducting drill site preparation (DSP), while exploration activities were expected to be conducted by the beginning of March.

Arief said the drilling had initially been scheduled for early December 2015 but had been postponed due to social problems.

'€œWe understand local people'€™s concern due to the trauma from the Sidoarjo mudflow. We don'€™t want to repeat the same incident and we are open to all parties wanting to participate in supervising [the drilling],'€ Arief said.

Geologically, he said, the drilling would not cause problems. He added that his office had been granted a license for drilling activity from the Sidoarjo Environmental Agency that was also signed by former Sidoarjo regent Saiful Ilah.

He said the geological analysis included environmental management scheme and environmental monitoring scheme (UKL-UPL) issued by the environment agency.

'€œThe UKL-UPL includes everything, including technical matters, geological matters and other things. It is safe,'€ he said.

He added that the drilling activities at Tanggulangin 1 had to be conducted soon, because gas output was decreasing.

Apart from that, he said, the government through the Upstream Oil and Gas Regulatory Special Task Force (SKKMigas), had also been encouraging the company to increase production to meet demand for gas in East Java.

PT Lapindo Brantas'€™ gas production at the Tanggulangin 1 well is predicted to reach 5 million cubic meters per day. If combined with the production of some 30 wells already in operation in Sidoarjo, the production would reach 8 million cubic meters daily.

Arief said the company, of which the majority of shares was owned by the Bakrie family, used to produce 80 million cubic meters of gas per day.

In the meantime, PT Minarak Lapindo, which was tasked with paying compensation to the mudflow victims, has not yet finished paying out the funds. There are 86 remaining files certifying land ownership in the affected area that have not yet been paid, out of a total of 3,331 files it has to deal with.

The government earlier agreed to bail out the powerful family to settle the remaining compensation for victims of the Lapindo mudflow disaster, providing a Rp 781 billion (US$62 million) loan to PT Minarak Lapindo Jaya.

The company claims it has so far spent Rp 6.1 trillion to handle both social and physical issues stemming from the mudflow.

Separately, the Sidoarjo Mudflow Mitigation Agency'€™s (BPLS) validation and complaints coordinator, Khusnul Khuluk, confirmed on Wednesday that some 86 files had not been paid out.

'€œWe will meet soon with the company to discuss the matter,'€ Khusnul said.

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