Crude oil output from ExxonMobil Corp.'s (NYSE: XOM) Cepu Block in Indonesia could reach 200,000 barrels per day (Mbbl/d) if the government approves an increase from the current production of 185 Mbbl/d, a company spokesman said on May 25.
Output from the Banyu Urip project in the Cepu Block in East Java province is crucial to Indonesia's long-term efforts to meet rising domestic oil demand as production declines at other ageing fields.
"From our reservoirs there is still the potential to increase Cepu Block production above 185,000 [barrels per day]," ExxonMobil spokesman Erwin Maryoto told reporters.
"It could be up to 200,000 [barrels per day], but [only] if the government agrees to all the permits, including environmental impact assessment. We are ready to increase production."
Crude output from Cepu more than tripled throughout 2015 from a year earlier, hitting about 130 Mbbl/d in December when Exxon began operations at the project's central processing facility.
Exxon has faced a host of problems and setbacks developing Cepu, Indonesia's biggest oil and gas find of the past decade, including a worker dispute that slashed output in August.
The Banyu Urip project is operated by Exxon in partnership with state energy company Pertamina.
Indonesia's upstream oil and gas regulator SKKMigas said the government needed to evaluate the potential production increase from the Cepu Block because it would involve an increase in costs.
"The current capacity of their facility is only 185,000 [barrels per day], so if they increase it, it means they will add capex," said SKKMigas deputy chairman Mohammad Zikrullah.
Indonesia's average daily crude output in the first quarter climbed to 835 Mbbl/d from an average daily output of 786 Mbbl/d in 2015, largely due to increased output from Banyu Urip.
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