Pertamina May Spend $100 Million to Boost Output at Cepu Field

By Bambang Dwi Djanuarto

Feb. 24 (Bloomberg) -- PT Pertamina, Indonesia’s state oil company, plans to spend $100 million this year to increase output at the country’s biggest untapped oil field that it owns jointly with Exxon Mobil Corp.

The partners plan to boost production from Cepu field on Java island to 20,000 barrels a day from 200 barrels a day in December, Ferederick Siahaan, finance director at Pertamina, said in Jakarta late yesterday.

The government wants Pertamina, the biggest contributor of dividend among state companies, to increase crude production amid declining oil prices. Cepu is estimated to have 600 million barrels of oil reserves and may produce 165,000 barrels a day at its peak.

“We’re evaluating whether to use internal cash or seek a loan,” Siahaan said, without elaborating.

Exxon and Pertamina each have a 45 percent stake in a venture to develop the field, while local governments hold the remaining 10 percent.

To contact the reporter on this story: Bambang Dwi Djanuarto in Jakarta at bbjakarta@bloomberg.net.