Medco role in promoting South Sumatra
as future national energy center
Hartono Nugroho Production Director Medco E&P Indonesia Sriwijaya University, July 6, 2011
Journey towards excellence
History of Medco Energi
1980 : Established Meta Drilling Company
Epsi Pribumi
1992 : Acquired small fields in East Kalimantan from Tesoro 1995 : Acquired 100% shares of Stanvac Indonesia from Exxon / Mobil 1996 : Discovered largest onshore oil reserve of decade (Kaji-Semoga) 2001 : Largest private Indonesian oil & gas company (100 MBOPD) 2004-2011 : Go International by acquiring asset in US, Australia and Middle East
2
Medco Energi
@ PT Medco E&P Indonesia 2011 All Information is Confidential
MedcoEnergi : Vision, Mission & Values
Vision :
The Energy Company of Choice
Mission :
To search for and develop energy resources innovatively and to increase stakeholders values in accordance with the highest ethical and environmental standards
Values:
Indonesia Operations
Large portfolio, domestic and international, offers diversification of opportunities and risks across broader geological formation.
Block A Bengara SUMATRA Central Sumatra Bangkanai KALIMANTAN
Nunukan Sembakung Simenggaris Tarakan
Senoro-Toili
Merangin South Sumatra Lematang
SULAWESI Rimau PAPUA Jakarta Bawean Jeruk
JAVA
Medco E&P Indonesia
Producing blocks Development blocks
7 1
Exploration blocks Economic interest
5 1
International Operations
Global presence enhanced Companys credibility when negotiating for hydrocarbon assets in under-exploited countries.
TUNISIA
OMAN
USA
LIBYA
YEMEN
Medco Energi Global
Medcos international operations spread across 20 assets in Asia, Africa, and the US
Libya
Exploration blocks 1
Oman
E&P service contract 1
Tunisia
Development blocks 1
Yemen
Exploration blocks 2
US (incl. Gulf of Mexico)
Producing blocks Exploration blocks 8 5
Medco strategy in oil and gas business
The Energy Company of Choice Reserve Growth, Production Increase Environmentally prudent
Increase stakeholders value Government Regional Government Stock holders Creditors Management Employees Local Communities Universities
Cost, Revenue and Resource Optimization
CSR & Local Empowerment
People & Technology Development
South Sumatra is one of national energy centers
Oil Reserve Jan 2010
NAD 127.21 NATUNA NORTH SUMATRA 111.89 383.35
Gas Reserve Jan 2010
ACEH (NAD) 5.74 NORTH SUMATRA 1.28 NATUNA
51.46
CENTRAL SUMATRA
3,790.48 CENTRAL SUMATRA SOUTH 909.80 SUMATRA 556.62 WEST JAVA
670.00 BORNEO
8.56
PAPUA 94.93 48.07
SOUTH SUMATRA 17.90 WEST JAVA 3.70
18.33 EAST BORNEO 4.23 CELE BES
PAPUA
24.32
49.78 CELEBES 1,022.35 EAST JAVA
MOLUCCAS
6.40 EAST JAVA
MOLU CCAS 15.22 (Advance Resources Interational, Inc., 2003 processed)
Source : ESDM
Source : ESDM
South Sumatra have significant reserves :
11.27 % of national oil reserves , 11.4% of national gas reserves , 40.3% of CBM resources
Contractors play a key role in cooperation with South Sumatra stakeholders in monetizing the reserves
Medco contributions to South Sumatra
2011 production : oil 22.58 mbopd , gas 165 bbtupd Supply domestic gas for :
Provide energy to the local community
Fertilizer plant (Pusri) Power plant (e.g PLTG Keramasan, Indralaya, Borang) City gas (Sarana Pembangunan Palembang Jaya) Energy Conservation/BBG (PDPDE South Sumatra) Support SEA Games
Oil sales to Pertamina Plaju Refinery Supply LPG to South Sumatra area
Optimize Cost and Maximize Revenue
Medco South Sumatra working area contributed $ 3.48 Billion to Government in last 5 years Maintain low operating cost to maximize benefit to the country
Medco contributions to South Sumatra
Green Proper company since 2009 Re-vegetation program : commit to replant cleared land Zero discharge : produced water recycling Cluster drilling system to reduce cleared land Reduce Emission : Associated gas utilization
Environmentally prudent operation
Strategic community development and empowerment
SRI Organic farming Education & religion facilities Training : agriculture, plantation etc Technical training for welder etc.
Corporate Social Responsibility
Local people development : hiring and developing local
people since early development and operation
Increasing local content and supplier development Strategic partnership with Sriwijaya University
Medco future development in South Sumatra : Going beyond conventional production
Rimau Enhance Oil Recovery Project
Increase oil production volume from existing reservoir by using new EOR technique (surfactant) Implementation of pilot project (EOR) in 2012 Full scale program aim to increase recovery factor by approximately 8-10%
Coal Bed Methane
Rambutan field : the first CBM study w/ Lemigas (2004) Medco : first company sign CBM contract in Indonesia Operates two CBM PSC in South Sumatra Sekayu PSC will start to produce CBM gas in 4thQ 2011
Rimau Heavy Oil Development
Develop heavy oil prospects requiring complex technology and high investment Currently in R&D stage Explore and develop deep prospect/fractured basement with prospective potential reserves
Onshore deeper prospect exploration
Concluding remarks
1. Medco has operated oil and gas business in South Sumatra for more than 20 yrs and play important role for national production and state revenue 2. Medco will explore and develop hydrocarbon with unconventional ways to support South Sumatra as a National Energy Center 3. Medco need continuous support from local stakeholders for sustainability of oil and gas industry in South Sumatra
PADMA Award 2003 & 2007 : Government of Indonesia Award for Sustainable Community Development Program
PROPER Hijau 2010 : Minister of Environment Award for consistent environment management
Thank You
PT Medco E&P Indonesia .. Proud of its achievements!
PROPER Hijau 2009 : Minister of Environment Award for consistent environment management Zero Accident 2007 : Minister of Manpower and Transmigration Award for zero accident 22.927.321 hours
Social Empowerment Award 2007 National Welfare Coordination Minister Award for community development program commitment
ISO 14001 (2007 & 2009) : TUV Nord Indonesia certification for environmental quality management system
