Indonesia’s Pertamina to Invest $237m in Sanga Sanga Oil Block
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State-owned energy company Pertamina plans to invest $237 million over the course of three years to develop the Sanga Sanga oil block in East Kalimantan, it announced on Wednesday (08/08).
Pertamina has just acquired the block from US-based Virginia Indonesia Company (VICO), which was operating it for four decades.
According to upstream oil and gas regulator SKK Migas, the Sanga Sanga oil block currently produces 10,753 barrels oil equivalent per day (boepd). The block, located in Kutai Kertanegara district, also produces 80.7 million metric standard cubic feet per day (mmscfd) of gas. It has an estimated cumulative production of 258 million barrels of oil equivalent (mmboe).
A senior Pertamina executive said the company will use this investment to increase production in the block by drilling 29 new wells next year.
Meidawati, upstream strategic planning, portfolio and evaluation senior vice president at Pertamina, said the block offers a great potential as Pertamina will maintain its production and also will search for new reserves.
“The Sanga Sanga block will be later integrated with the company’s other blocks such as Pertamina EP and Mahakam, so in the end it would become cost effective for the company,” Meidawati said in a statement on Wednesday (08/08).
Sanga Sanga will be operated by Pertamina’s subsidiary, Pertamina Hulu Sanga Sanga.
“As representatives of the government, we appreciate VICO Indonesia’s contribution and hard work as Sanga Sanga oil block’s operator. Pertamina is now preparing for the transfer and will continue its operations,” SKK Migas head Amien Sunaryadi said.
Questions & Answers
Q.What is the primary goal of Pertamina's investment in the Sanga Sanga oil block?
What is the primary goal of Pertamina's investment in the Sanga Sanga oil block?
Pertamina aims to increase production in the block. This will be achieved by drilling 29 new wells next year, as part of the $237 million investment over three years.
Q.Who was the previous operator of the Sanga Sanga oil block before Pertamina acquired it?
Who was the previous operator of the Sanga Sanga oil block before Pertamina acquired it?
The Sanga Sanga oil block was previously operated by the US-based Virginia Indonesia Company (VICO). They had been operating the block for four decades before Pertamina's acquisition.
Q.How will the Sanga Sanga block contribute to Pertamina's overall operations?
How will the Sanga Sanga block contribute to Pertamina's overall operations?
The Sanga Sanga block will be integrated with Pertamina's other blocks, such as Pertamina EP and Mahakam. This integration is expected to make operations more cost-effective for the company.
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