CPC Corp, Taiwan (CPC, 台灣中油) will team up with Vico Indonesia, which is jointly owned by BP PLC and Italy’s Eni SpA, to explore and develop coal-bed methane in Indonesia for 30 years, the state-run refiner said in a statement late on Tuesday.
CPC said it secured a production sharing contract on Monday from the consortium led by Vico Indonesia to explore coal-bed methane from the Sanga-Sanga block in East Kalimantan on Borneo island.
CPC joined the Vico consortium through its overseas subsidiary Opicoil Energy.
The Sanga-Sanga block is estimated to have a reserve of about 110 billion cubic meters of natural gas, which could help boost Taiwan’s energy resources, CPC said in the statement.
Coal-bed methane is a form of natural gas stored in coal seams at depths of between 300m and 1,500m. In the US, about 4 percent of the natural gas for household use are extracted from coal-bed methane, CPC said, adding that Canada, Australia, China, India and Indonesia have been developing coal-bed methane in recent years.
Indonesia awarded the exploration rights to the Vico consortium on Nov. 25. CPC has a 20 percent stake in the consortium; other shareholders are BP (26.25 percent), Eni (26.25 percent), Virginia Indonesia Co (15.6 percent) and Universe Gas and Oil Co (4.4 percent), CPC said.
The consortium plans to drill 11 wells in the first three years at a cost of US$37.9 million, CPC said.
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