Chevron, ConocoPhillips sign Indonesia gas supply deal

JAKARTA, May 31 (BestGrowthStock) – Chevron Corp (CVX.N: ), the
biggest oil producer in Indonesia, has signed a final supply
deal to buy natural gas from ConocoPhillips (COP.N: ) on Sumatra
island, the head of Indonesia’s energy watchdog, BPMIGAS, said
on Monday.

ConocoPhillips has agreed to two separate deals, amending
terms to an existing deal after some politicians complained
that the deal was unfair because of the rise in oil prices.

It will supply a total of 77.9 trillion British thermal
units of gas during a four-year period, and an additional 1,177
trillion British thermal units over a 12-year period, Priyono,
BPMIGAS chief, told reporters.

ConocoPhillips will supply the gas from its fields in South
Sumatra.

The gas deal will replace a previous agreement under which
Chevron swapped about 50,000 barrels per day (bpd) of crude oil
from Duri for about 400 million cubic feet per day of natural
gas from ConocoPhillips’ gas field in South Sumatra.

“This final deal will guarantee long-term gas supply to
support Chevron’s operations in Sumatra,” Priyono said.

Chevron needs the gas to support technology used to coax
more oil from its Duri field in Central Sumatra. The
technology, known as steamflood, can enhance recovery on oil
fields where output is declining.

Priyono said that Chevron currently produces about 370,000
barrels per day of crude oil, including Minas and Duri, from
its operation in Central Sumatra.

Indonesia has turned into a net importer of crude in recent
years, as production has slumped after a failure to tap new
fields fast enough.

Southeast Asia’s biggest economy produced about 1.5 million
bpd about a decade ago, but production has now slumped to below
1 million bpd.

Stock Market Today

(Reporting by Muklis Ali; Editing by Sara Webb)

Chevron, ConocoPhillips sign Indonesia gas supply deal