ExxonMobil plans to sell its Indonesian affiliates Mobil Exploration Indonesia, ExxonMobil Oil Indonesia and Mobil Indonesia LNG, which hold stakes in the Aceh gas and LNG producing operation, the US company said Monday.
ExxonMobil Oil Indonesia has a 100% stake in the Arun LNG field and its satellite fields of South Lhoksukon A & D, and Phase A & B onshore; Mobil Exploration Indonesia holds a 100% stake in the North Sumatra Offshore field; while Mobil Indonesia LNG holds a 30% stake in the Arun LNG processing plant.
Gas production from these fields have been dwindling, and last year they produced an annual average of 215,000 Mcf/day of gas and associated liquids, compared with the peak production of 3.4 Bcf/d gas in 1994 and about 130,000 b/d condensate in 1989, the company said.
The gas from the fields is delivered to the Arun LNG processing plant, which is operated by Arun NGL -- a joint venture between state-owned Pertamina (55%), Mobil Indonesia LNG (30%) and Japan-Indonesia LNG Company (15%).
The decision to sell these affiliates is consistent with the company's practice of continually reviewing its assets for their contribution to ExxonMobil's operating and financial objectives, as well as their potential value to others, the US company said in a statement.
ExxonMobil's contract in Aceh province will expire in 2018, while its commitment to export LNG to Asian buyers will expire in 2014.
The Arun LNG plant, located in Nanggroe Aceh Darussalam, started operations in 1978, and strengthened Indonesia's position as an LNG exporter, following exports from the Bontang liquefaction facility in 1977.
The plant, with an annual production capacity of 6.5 million mt across four trains, was a reliable LNG supplier to Japan and South Korea until around 2004 when dwindling gas production at nearby fields led to a drop in the plant's output.
The facility is expected to export only 29 cargoes this year, compared with 38 in 2010 and an average of around 150 cargoes between 1978 and 2003. Arun NGL has been gradually winding down its export contracts and the last of the contracts with the Japanese and South Koreans are due to expire in 2014.
ExxonMobil's other projects and interests in Indonesia will not be affected by this selling, the statement said.
Pertamina has proposed to convert the 33-year old Arun LNG plant into an LNG import and regasification terminal at a cost of $80 million. It is expected to take around 20 months to complete and will have an initial capacity of 100,000 Mcf/d.
