Indonesian independent Medco Energi is embarking on two significant offshore field developments in the Natuna Sea near its multi-field oil and gas complex in Block B.
Sources said there are two projects in the early engineering phase — Forel and Baronang.
The development concept for Forel is a wellhead platform and floating production, storage and offloading vessel.
Subsea connections will join the platform to the leased FPSO, while a separate gas flowline via a pipeline end manifold will connect gas output to the nearby Belanak oil and gas field in nearby Block B.
Meanwhile, the Baronang project is also taking shape — it will be more simple, hosting a wellhead platform tied in to a nearby field.
Sources said an engineering contract has been let to Indonesian front-end specialist Synergy and that Medco should be ready to tender engineering, procurement, construction and installation contracts next year.
No other detailed information was available on the two projects as Upstream went to press, and Medco had not responded to inquiries.
Medco took full control of the Natuna Sea Block B area about two years ago following its acquisitions of ConocoPhillips’ 40% operator interest, Inpex’s 35% stake and finally Chevron’s 25% equity.
Block B contains numerous producing fields including Belanak, Belida, North Belut, Kerisi and Hang Tuah.
Medco, which is listed on the Jakarta Stock Exchange, said recently that its licence to the Block B area expires in October 2028, and that the gross maximum rate of gas production in 2018 was 235 British thermal units per day.
The Block B project provides it with "strong net cash flow linked to commodity-linked and fixed-priced gas sales into Singapore and Malaysia". Medco added that: "Future near-field exploration, subsea developments and production optimisation will extend field life and mitigate asset decline rate."
The company said in its latest exploration report that a new exploration well in Block B called Tuna-1 found gas and flow tests were positive.
The well was plugged and abandoned, and Medco said it will further evaluate the new discovery with lab analysis.
The Jakarta-based operator has grown significantly in recent years with acquisitions including Lundin Petroleum’s Indonesia subsidiary and its recent takeover of Ophir Energy.
The acquisition of Ophir increased its production by about 29% to 110,000 barrels of oil equivalent per day, and its combined proven and probable and contingent resources were boosted 86% to 1.4 billion boe.
In its latest financial results, the company said the Ophir integration "is on track with the focus now on system, organisation and process alignment in order to realise the expected synergies".
Medco said that it recently withdrew from exploration ventures in Vietnam and Bangladesh and also sold positions in Indonesia, all of which were inherited from Ophir.
The Vietnam acreage comprised of 50% interests in Block 123 and 40% of Block 124, both in the Phu Khanh basin.
Medco retains a 31.9% interest in the producing Chim Sao and Dua oil project in Vietnam.
In Bangladesh, Medco exited the country by withdrawing from Block SS-11 in which it held 45%.
The joint venture partners in SS-11 are KrisEnergy and Bangladesh Petroleum E&P.
In Indonesia, the company's 60% interest in the Aru licence has been sold, as has its 49.9% stake in the West Papua contract area.
Nevertheless, Medco retains a significant portfolio of exploration and production assets in Indonesia.
