PGN Buys Kufpec's Stake in Java Gas Block

Saka Energi Indonesia, subsidiary of Indonesian gas distributor Perusahaan Gas Negara (PGN), has agreed to buy Kuwait Foreign Petroleum Exploration Company’s (Kufpec) 25% stake in East Java gas field.

PGN corporate communications Ridha Ababil on Tuesday said the state-owned company’s upstream arm would purchase Kufpec’s participating interest at the Ujung Pangkah block for $265 million, The Jakarta Globe reported.

In March this year, PGN president director Hendi Prio Santoso said the company was contemplating investing in a number of blocks across the archipelago through Saka Energi.

Kufpec bought the participating interest in the block from American oil and gas giant ConocoPhillips in 2007, the newspaper said.

The Ujung Pangkah block, operated by Hess Corp, which holds 75 percent participating interest, currently produces 40 million meters standard cubic feet per day (mmscfd) of natural gas and 7,000 barrels per day (bpd) of oil and condensate.