BP, Partners Awarded CBM Contracts

BP and its local partners have signed four new production sharing contracts over 4,800 square kilometres of coal bed methane areas in Indonesia.

BP and PT Sugico Graha were jointly awarded the Kapuas I, II and III CBM production sharing contracts, in the Barito basin of Borneo’s South Kalimantan province in each of which BP will hold a 45% interest and Sugico the remaining 55%.

BP (44%) and state-owned PT Pertamina (56%) jointly won the Tanjung IV CBM production sharing contract through a direct award.

Chief executive Robert Dudley said the agreements follow recent contracts to access new resources in Indonesia, China, India and Australia.

“BP has significant experience and expertise in the development of unconventional gas, including coalbed methane, and we look forward to working with our partners to apply this to the potential of Indonesia's coal resources,” he said.

David Nicholas, a spokesman, said BP had committed to spend $15m on seismic exploration and surveying over the next three years and might begin production within that period.

Indonesia has one of the world’s largest resources of the unconventional natural gas resource extracted from coal deposits.