Exxon's Cepu Block Starts Producing Limited Amount of Crude

Dow Jones Newswires

JAKARTA (Dow Jones Newswires), December 10, 2008

Exxon Mobil Corp. said that the Cepu Block in Indonesia started producing Wednesday a "limited" amount of crude oil that is expected to rise to 20,000 barrels a day in the first half of 2009.

The U.S. company owns a 45% stake in the block, which is estimated to contain 600 million barrels of oil.

State-owned PT Pertamina holds another 45% of the equity, and several companies owned by the local governments hold the remaining 10%.

The full output of the block, located on the border of central and east Java, is expected to be 165,000 barrels/day. The block is vital to Indonesia's hopes to bring its crude output back above one million barrels/day.

Indonesia turned a net oil importer in 2003 and will cease its membership in the Organization of Petroleum Exporting Countries next month.  

Copyright (c) 2008 Dow Jones & Company, Inc.