Indonesia: BP Signs Four Coalbed Methane Production Sharing Contracts


BP said Friday that it has signed four new coalbed methane (CBM) production sharing contracts (PSCs) in the Barito basin of South Kalimantan, Indonesia.

BP and co-owner Pertamina were jointly awarded the Tanjung IV CBM PSC through a direct award from the Government of Indonesia. BP will hold a 44 per cent participating interest in the PSC with Pertamina holding the remaining 56 per cent.

BP and co-owner PT Sugico Graha (Sugico) were jointly awarded the Kapuas I, II and III CBM PSCs through a direct offer from the Government of Indonesia. BP will hold a 45 per cent participating interest in the PSCs with Sugico holding the remaining 55 per cent.


Bob Dudley, BP group chief executive, said, “Today’s agreements follow on from BP’s recent agreements to access new resources in Indonesia, China, India and Australia. BP has significant experience and expertise in the development of unconventional gas, including coalbed methane, and we look forward to working with our partners to apply this to the potential of Indonesia’s coal resources.”

Together, the four PSCs cover an area of approximately 4,800 square kilometres.

“BP is very pleased to be extending our working relationship with Pertamina in the development of Indonesian CBM resources, and also to cooperate with Sugico in creating a material CBM position in a highly prospective basin. These four PSCs complement BP’s existing CBM position in Indonesia, allowing us to leverage our 30-plus years of CBM experience to deepen our portfolio in Kalimantan,” said William Lin, BP’s President of Asia Pacific Exploration & Production.

These awards mark BP’s first CBM access in Indonesia outside its joint venture with ENI, VICO, which in late 2009 was awarded the Sanga Sanga CBM PSC near the Bontang LNG plant in East Kalimantan.

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