Indonesia’s Medco Resumes Libyan Oil Exploration Project

Whisnu Bagus

Indonesia’s largest publicly traded energy company, Medco Energi Internasional, announced on Tuesday it would continue with plans to explore an oil field in Libya, and is preparing to establish a joint venture next month for that task.

Medco president director Lukman Mahfoedz said Medco, through its subsidiary Medco International Venture Limited, would own 25 percent of the stake in the joint venture, with the Libyan government owning 50 percent and another contractor the remaining 25 percent.

“The joint operating company will develop the project,” Lukman said in Jakarta, adding that Medco would build supporting facilities for the project, among other contributions.

Medco’s plan to develop the Area 47 block was suspended last year following the bloody conflict in Libya. A preliminary engineering study for the project, however, was launched after tensions eased.

Lukman said Area 47 was estimated to be able to produce up to 50,000 barrels of oil per day, and that the project cost a total of $800 million.

“We’ve allocated $200 million for the next four years,” he said, adding that the fund would come from Medco’s internal cash and bonds.

Medco recently acquired 21.25 percent stake in Yemen’s Block 9 oil field through its subsidiary Medco Yemen Malik Ltd. It purchased the stake at $95 million.

Investor Daily/JG