Unocal Secures OPIC Funds

OPIC will be providing support of up to $350 million in OPIC financing for two offshore oil and natural gas projects in Indonesia. The projects, which will yield an estimated 145 million barrels of oil, are sponsored by Unocal Corporation.

OPIC's financing nearly single-handedly fulfills a joint initiative of OPIC, the U.S. Export-Import Bank and the U.S. Trade and Development Agency to provide $400 million in loans and guarantees to finance U.S. investments in Indonesia. The initiative, announced last September, specifically targeted the oil and gas sector. The projects, in which both Unocal and Pertamina, the Indonesian state oil and gas company, will participate, will develop the West Seno offshore crude oil and natural gas fields in the Makassar Straits off East Kalimantan. Production from both projects will be sold in Indonesia and in the general Asian petroleum market.

West Seno I, the first project, will feature construction of a deep-water production platform, a floating processing unit, and two 60-kilometer oil and gas pipelines from the platform to an existing terminal at Santan; and the drilling of more than 20 production wells. OPIC is providing a $300 million loan to this project.

West Seno II, which will receive a $50 million loan from OPIC, will involve construction of a second deep-water drilling platform and the drilling of an additional 20+ production wells. The second project will share processing and transportation infrastructure with the first.

OPIC President and CEO Dr. Peter Watson said the projects "demonstrate U.S. investor confidence in the stability of Indonesia and its reform efforts. OPIC is pleased to support both a U.S. business and Indonesia's efforts to become oil independent." The projects will generate approximately $200 million in procurement in Indonesia, as well as roughly $66 million in procurement in the United States. OPIC is currently providing $244 million in political risk insurance and $216 million in financing to projects in Indonesia.


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