Pertamina revives overseas acquisition plan

JAKARTA. Indonesia’s state-owned oil and gas firm PT Pertamina has resumed its campaign to acquire oil and gas blocks overseas to boost the company’s production for 2013 after last year’s planned acquisitions fell short of the original target, a company executive has said.

Pertamina investment-planning and risk-management director Afdal Bahaudin told The Jakarta Post on Tuesday the firm, currently the second-biggest oil producer in the country behind US-based Chevron, would continue its plan to acquire oil and gas blocks overseas.

“Last year’s target of reaching an additional output of around 25,000 barrels per day [bpd] of oil from overseas acquisitions has yet to be reached. Hence, we will try to make it happen for this year’s target,” he said in a telephone interview.

Pertamina has been exploring opportunities to acquire oil and gas blocks overseas to boost its own oil production level, which is currently between 170,000 and 200,000 bpd, trailing behind top producer Chevron Pacific Indonesia with around 350,000 bpd.

Last year, Pertamina announced the firm was seeking an additional 32,000 bpd of oil by acquiring five overseas oil and gas blocks, including one in Venezuela. At that time, Pertamina said it planned to buy a 32 percent stake from the South American country’s Petrodelta SA.

However, as the political situation in Venezuela has yet to return to normal following the deteriorating health of President Hugo Chavez, the acquisition plan has yet to be concluded.

Last year, Pertamina also planned to buy a stake in Canada-based Coastal Energy, which has assets in several regions in Southeast Asia. Pertamina ultimately withdrew the plan following disagreement over the purchasing price of the stake.

In December, Pertamina signed an agreement with US-based ConocoPhillips to purchase the New York-listed firm’s Algerian unit, North ConocoPhillips Algeria Ltd. in a transaction reported to be worth US$1.75 billion.

While Pertamina was looking to obtain an additional 35,000 bpd from the Algerian block, the plan has yet to be approved by the local government due to recent militant attacks in January in which several foreigners were held hostage.

On Tuesday, Pertamina’s Afdal said the firm would continue to “exercise every opportunity” to obtain production of oil and gas basins abroad, but added that “the firm was bound by the non-disclosure agreements on several talks.”

Pertamina has been reportedly looking at oil and gas blocks in Gabon, which was also once a member of the Organization of Petroleum Exporting Countries (OPEC) before quitting in 1994.

Pertamina expects to increase production to 243,920 barrels per day (bpd) at the end of this year, a 24.4 percent increase from the 196,060 bpd it booked in 2012. Pertamina’s subsidiary, PT Pertamina EP, is expected to make the biggest contribution of 137,200 bpd to the target, followed by its other subsidiaries, Pertamina Hulu Energi with a target of 76,000 bpd and Pertamina EP Cepu with 10,800 bpd.

Pertamina is aiming to produce 1,691 million standard cubic feet of natural gas per day this year, up from the 1,539 it produced in 2012.

In 2012, the firm reaped $2.76 billion in net profits, an 18.4 percent increase from the $2.33 billion it booked the previous year. (Amahl S. Azwar, The Jakarta Post)