Eni Awarded Coal Bed Methane License in Indonesia
Eni, through its joint venture affiliate VICO CBM Limited, has today been awarded a 37.8% stake in Sanga Sanga, a new coal-bed methane (CBM) production sharing contract (PSC), in Indonesia. Eni's partners are BP (37.8%), Opicoil (20%), a Houston based subsidiary of Taiwan's CPC, and Universe Gas and Oil (4.4%), a Japanese consortium including Japex and the Osaka Gas Group.
Sanga Sanga, located in the gas rich Kutei Basin of East Kalimantan, is Eni's first major coal-bed methane project and it will be operated by the joint venture VICO (Eni 50%, BP 50%). Preliminary study in the block shows resources potential of about 4 trillion cubic feet (111 billion cubic meters) of gas to be better defined through an appraisal program that will commence in 2010.
The Sanga Sanga CBM PSC, which will be connected to the Bontang LNG, has the potential to become the first 'CBM to LNG' integrated project, enabling rapid gas commercialisation.
This success confirms Eni as one of the major oil companies exploring in Indonesia and an important player in developing the CBM business. Indonesia has estimated CBM resources of 453 trillion cubic feet of gas in place, which are amongst the largest in the world, after the United States and China.
Eni has recently made two important discoveries in the nearby offshore Kutei and Tarakan basins - Tulip (Bukat PSC) and Jangkrik (Muara Bakau PSC) - both of which are now in an advanced appraisal phase. Moreover, Eni has recently submitted a plan of development for the Jau field in the North Sumatra Krueng Mane PSC.
In Indonesia, Eni holds equity interests in eleven PSCs, of which it is operator of six. Eni's offshore activities are located in deepwater offshore Kalimantan, North Sumatra and West Timor.
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