August 11, 2015 / 11:18 AM / in 4 years

UPDATE 1-ConocoPhillips to seek buyers for stake in Indonesian oil, gas block -sources

* ConocoPhillips looks to sell stake in South Natuna Sea Block B

* Block B oil output to drop to 15,000-17,000 bpd next year

* Block’s gas output to fall to 203-300 mmscfd in 2016 (Adds production forecasts, context)

By Wilda Asmarini

JAKARTA, Aug 11 (Reuters) - U.S. oil and gas company ConocoPhillips is reviewing its portfolio in Indonesia and may soon seek buyers for a stake in a production sharing block it operates in the Natuna Sea, company and government sources said.

The proposed divestment by ConocoPhillips follows a series relinquishments of oil and gas assets in Indonesia in recent months amid oil prices that have dropped more than 50 percent over the last year.

Majors ExxonMobil and BP have both handed back exploration blocks this year to Indonesia, and Swedish independent Lundin Petroleum has said it is exiting the country.

ConocoPhillips has proposed to upstream oil and gas regulator SKKMigas to open its data room for its holding in South Natuna Sea Block B, the agency’s spokesman Elan Biantoro told Reuters. Such requests were usually made by companies “that want to farm out their participating interests,” he noted.

ConocoPhillips was opening the data room to offer its share to other investors, company spokesman Joang Laksanto confirmed.

ConocoPhillips holds a 40 percent interest in South Natuna Sea Block B, and other companies with participating interests are Chevron, with 25 percent, and Japan’s Inpex , which holds 35 percent.

Company representatives declined to comment on whether ConocoPhillips plans to sell its entire stake or a portion of its interest in the Natuna block.

The representatives also would not say if the proposed sale would impact ConocoPhillips commitment to invest $2.5 billion in Indonesia over the next three to four years.

Operating two oil and gas blocks in Indonesia - Natuna and the Corridor Block in South Sumatra - ConocoPhillips contributes more than 20 percent of Indonesia’s natural gas production, 24 percent of its liquefied petroleum gas output and 6-7 percent of its crude oil production, according to Indonesia’s energy minister, Sudirman Said.

ConocoPhillips’ contract to operate the Natuna Sea Block B is due to expire in 2028.

According to data from SKKMigas, the South Natuna Sea Block B is expected to produced between 15,000 and 17,000 barrels per day (bpd) of crude oil in 2016, down from 21,400 bpd this year.

The block is also expected to produce between 203 million and 300 million standard cubic feet per day (mmscfd) of gas in 2016, versus 296 mmscfd this year.

Writing by Fergus Jensen; Editing by Tom Hogue

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