France’s Total announced its plan to cut its spending in Indonesia’s giant Mahakam gas block by 42% to $1.1b in 2016, down from $1.9b in 2015, Platts reported.
The move comes as a result of lower oil and gas prices, a Total’s senior official said. The company plans to decrease its production to 1.4bcf/d of gas and 56,000b/d of condensate in 2016 – caused by natural decline as several of the block’s fields have already matured – which is even lower than a mid December report by Reuters indicated.
The aging block is currently estimated to contain 2.7-3tcf of proven natural gas reserves before end 2017, but the reserves are expected to dwindle further in 2018. The Mahakam block is the main source of gas for Indonesia’s Bontang liquefied natural gas (LNG) plant in East Kalimantan.
In earlier news, Indonesia state-owned energy firm PT Pertamina was reported to have agreed to take over Mahakam Natural Gas Block Offshore project from French Total and Japan’s Inpex Corporation as of Jan 2018, Deal Street Asia wrote.