ExxonMobil faces Cepu field threat

By AMANDA BATTERSBY London

 24 September 2009 23:01 GMT

Indonesian lawmakers have called for state oil and gas company Pertamina to take over operatorship of the Cepu block in Java from joint operator ExxonMobil, claiming the US giant is to blame for lower-than-promised production and escalating costs.

Pertamina has notified upstream regulator BPMigas to review Cepu's joint operating agreement with ExxonMobil in light of the project's lacklustre performance to date.

BPMigas chairman Raden Priyono said that the body might even impose sanctions on the US partner if it failed to meet its production target by March 2010.

Last December, ExxonMobil, Pertamina and their minority partners brought on stream the Banyu Urip oilfield on Cepu at an initial 800 barrels per day, much lower than the touted phase one output of 20,000 bpd. Production was then suspendedin March, reportedly due to…

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