Conoco Production Unit Nears Completion for Indonesian Gas Export

Published March 28th, 2001 - 02:00 GMT

Conoco has inaugurated its technologically-advanced moveable offshore gas production unit, or MOgPU, for use in the company's Indonesia West Natuna Sea Block B fields.  


The MOgPU was built by Hyundai Heavy Industries in Ulsan, Korea, with the inauguration marking the completion of construction.  


The unit sailed today for Indonesia, slated to arrive in early April in the West Natuna Sea, where it will begin its field commissioning phase.  


The MOgPU, named "Hang Tuah" after a legendary 14th century Indonesian Admiral known for his adventurism and bravery, was developed after Conoco led negotiations to bring about the first export sale of pipeline gas from Indonesia to Singapore.  


The agreement, signed in early 1999, culminated two years of planning to develop a project capable of delivering 325 million cubic feet of natural gas per day from Indonesia's West Natuna Sea to Singapore.  


First gas, scheduled for July 2001, will be piped to Singapore via the 400-mile-long West Natuna Transportation System (WNTS), one of the world's longest subsea pipelines. The WNTS is a joint venture between Conoco Indonesia Inc.  

Ltd., (operator of the pipeline), Premier Oil, and Gulf Indonesia Resources, in support of Pertamina, Indonesia's state-owned oil company.  


"Indonesia has been one of the world's largest producers of natural gas over the past 10 years, with known gas reserves that exceed 100 trillion cubic feet.  


The lack of a suitably developed domestic market, combined with the lack of a gas export pipeline system, prevented most of the gas from being developed," said Rob McKee, Conoco executive vice president, worldwide exploration and production.  


"With the early completion of the WNTS last December, and production through Hang Tuah beginning later this year, there is now a vital link between an abundant supply of natural gas and a growing market for clean and efficient fuel."  


In 1999, the Conoco-operated Natuna Sea Block B Production Sharing Contract (PSC) group signed a 22-year natural gas sales contract with Pertamina to sell gas to Singapore.  


Then, in October 2000, Conoco-operated Block B was named the sole supplier of natural gas in a 20-year Indonesia-to-Malaysia sale.  


"Conoco is establishing Southeast Asia as our fourth worldwide significant business area," said McKee. "Over the past two years alone, we have made several discoveries offshore Indonesia that are expected to more than double the gas reserves dedicated to the Singapore and Malaysian sales contracts. We also have added to our significant positions in Vietnam and Malaysia."  


"We fully understand the need to economically capture natural gas and deliver it to growing Asian markets.  


To do that requires us to think creatively and to develop new technology that offers considerable operational efficiencies and cost savings. This was the genesis of the MOgPU idea," he added.  


Traditionally, offshore platforms require heavy construction equipment with large barges and cranes for on-site installation, plus extensive hook-up and commissioning efforts.  


The Hang Tuah MOgPU was built onshore where labor and other costs are cheaper than assembling it in the water. The same vessels used for towing the MOgPU to location will position and install the platform. 


Once the new steel gravity platform reaches its destination, it will be floated off its transportation vessel and become a barge capable of floating on its own buoyancy.  


To lock it in place, the Hang Tuah MOgPU utilizes a set of simple cable strand jacks that lower the base structure and pull the platform up on the legs.  


The jack-up system will be rented, then returned, providing significant cost savings over traditional heavy construction equipment and barges.  


Conoco can relocate the Hang Tuah MOgPU at a relatively low cost as reserves are depleted and new fields are brought on stream within the block.  


Conoco Indonesia Inc. Ltd., as operator, holds a 40-percent interest in Block B PSC in partnership with Inpex (35 percent) and Texaco (25 percent).  



© 2001 Mena Report (

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