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T Pertamina EP Cepu (PEPC), a subsidiary of oil and gas giant Pertamina, plans to develop more fields within the oil-rich Cepu block to increase its capacity following the development of the Banyu Urip oil field and the Jambaran-Tiung Biru gas field in nearby Central Java.

PEPC president director Adriansyah said the company had been eyeing Kedung Keris, approximately 14 kilometers from the main Banyu Urip oil field. The company estimates that the Kedung Keris field will be able to produce 5,000 to 8,000 barrels of oil per day (bopd).

The Kedung Keris plan of development, which includes the construction of a maximum of two wells and a pipe to the Banyu Urip central processiong facility, has already been agreed upon and is expected to be finished and ready for operation in 2019.

“[The Kedung Keris] field is an expansion of the Banyu Urip field and will use its facilities. Hopefully, when Banyu Urip hits natural decline, we can start lifting from Kedung Keris,” Adriansyah told reporters at a press conference recently.

The government has estimated that national demand this year will reach 1.2 million bopd. However, the country only produced an average of 835,000 bopd from January to March.

The Cepu block, with its main oil field Banyu Urip, produces up to 20 percent of national oil output, making it the second-largest oil producer in the country. With construction of its new facilities expected to be completed in the middle of the year, the Banyu Urip field has exceeded its expected peak production of 165,000 bopd and is currently producing an average of 170,000 bopd.

Adriansyah said that the field’s peak production was expected to last until 2019 before naturally declining.

Meanwhile, PEPC is also considering developing more gas fields within the block at Banyu Urip, Cendana and Alas Tua West in addition to the US$2.4 billion Jambaran-Tiung Biru gas field project.

It is estimated that Jambaran-Tiung Biru will produce 185 million standard cubic feet per day (mmscfd) of gas. As much as 100 mmscfd will be allocated by Pertamina to electricity generation and the other 85 mmscfd will be used for the fertilizer industry, through Pupuk Kujang.

The additional Cendana, Alas Tua West and Banyu Urp gas fields, which will come on stream in 2020 or 2021, are expected to produce an additional 100 mmscfd in total.

The Jambaran field is located within the Cepu block, which is currently operated by ExxonMobil Indonesia’s unit ExxonMobil Cepu Limited that holds a 45 percent interest in the block.

PEPC holds another 45 percent of the Cepu block while the remaining 10 percent is owned by the Cepu Block Cooperation Body, which is made up of locally owned companies run by the administrations of Blora regency, Bojonegoro regency, East Java province and Central Java province.

The Tiung Biru, meanwhile, field is located inside Pertamina’s operation area adjacent to the Cepu block. PEPC and ExxonMobil Cepu Limited have agreed to combine the two fields in September 2012.