Chevron has become the latest oil major to surrender an Indonesian assest after deciding to relinquish its stake in the East Kalimantan oil and gas block.
The company said Tuesday it will not extend its contract to operate in the East Kalimantan block, just months after Lundin Petroleum sold its assets in the country.
Chevron IndoAsia Business Unit managing director Chuck Taylor said on Tuesday that the company expects to relinquish the block to Indonesia’s government on October 24, 2018 and added that the move will not impact the company’s “pursuit of strategic projects” in the country.
The East Kalimantan PSC is managed by Chevron Indonesia Company, a Chevron subsidiary.
A spokesman for Indonesia’s oil and gas regulator told Retuers that the government has been informed of Chevron’s plan and is assessing whether it will tender the assest again or give it to state-owned Pertamina.
The block sends about 20,000 barrels of crude per day to the Balikpapan refinery and as many as 70 million standard cubic feet of natural gas per day to the Bontang LNG plant, Chevron told Retuers.
Chevron currently holds a 92.5 percent interest in the East Kalimantan block.
“This decision does not affect our commitment to continue our 90 year history of operations in Indonesia and our pursuit of strategic projects such as the Indonesia Deepwater Development (IDD). Chevron is proud of its strong partnership with the people and the Government of Indonesia and is committed to continue supporting the country to develop its energy resources safely, efficiently and reliably,” Taylor said.
Last year, BP and ExxonMobil both relinquished exploration blocks in Indonesia while Sweden-based Lundin Petroleum said in October that it will exit the country after agreeing to sell its Indonesian assets for $22 million.
Indonesia rejoined OPEC in December after a six year hiatus prompted by falling production.
The U.S. Energy Information Administration said oil production in the country continued to decline in 2014 after no new major projects came online to offset declining production at maturing fields.
Indonesia had the twelfth largest proved natural gas reserves in the world with 103 trillion cubic feet of proved reserves as of 2015.