Engaging with Local Communities A VICO Perspective May 2013
Delivering Clean Energy Safely
VICO Overview SEMBERAH 28 MMCFD / 1400 BPD BADAK 80 MMCFD / 1100 BPD NILAM 165 MMCFD / 3300 BPD • VICO has been operating in Kalimantan since the early 1970’s. • VICO operates the Sanga Sanga PSC (oil MUTIARA 152 MMCFD / 12200 BPD and gas) and the Sanga Sanga CBM PSC. • VICO is a 50:50 partnership between BP and Eni. • Driving force behind LNG development in Indonesia • Delivered over 12 Tcf of gas to domestic and export markets • Leading CBM explorer in Indonesia and first to produce and sell CBM gas to LNG and domestic power generation. VICO Indonesia Engaging with Local Communities
VICO at a glance • 4 main production centers • 4 camps (1 primary) • 800+ Development wells drilled • 2,850 + gas/oil reservoirs • 54 compressors (incl. 10 rentals) • 25 generators • 185 pumps • 82 pressure vessels • 13 glycol dehydrators • 24 heater treaters • 23 storage tanks • 1,000 km of pipeline VICO Indonesia Engaging with Local Communities
VICO External Affairs Goals • Be a recognized industry leader in responsible energy development, innovative solutions and good neighbor practices. • Deepen trust through relationships based on mutual advantage by “doing the right thing” in the communities where VICO operates . – Assess local community CSR projects based on “need” not “want”. – Ensure local communities participate in VICO activities through encouraging contractors to use local labor where possible. – Manage expectations in terms of VICO role in development of local communities. • Prevent criticism and misunderstandings of VICO’s business by maintaining open, honest and coordinated communications with SKKMIGAS, MIGAS, Central and local government, landowners, community leaders and media. • Establish VICO’s brand and reputation profile to support VICO business objectives. VICO Indonesia Engaging with Local Communities
Investing for today and the future 10 100 900 Number of Rigs (Conventional+CBM) Dynacoil 9 90 Number of Rigs (Conventional) 800 Facilities Number of New Wells (Conventional+CBM) Frac 655 MMCFD 8 80 Number of New Wells (Conventional) RDS 700 New Wells 7 70 Workover Number of New Wells Inlet Gas Rate, MMCFD Rigless 600 535 MMCFD Number of Rigs Base 6 60 473 MMCFD 500 452 MMCFD 435 MMCFD 428 MMCFD 5 50 MMCFD 378 385 MMCFD Review 400 4 40 Decline 300 3 30 200 2 20 1 10 100 0 0 0 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012 2012 1999 2001 2003 2005 2007 2009 2011 2013 2015 Base 2006 VICO is investing in both conventional and CBM drilling to maintain conventional gas Base Base Base Base Base Base Base Base 531 MMCFD 416 MMCFD 367 MMCFD 341 MMCFD 320 MMCFD 312 MMCFD 292 MMCFD 268 MMCFD production and develop CBM for the future. 51% 47% 49% 39% 44% 45% 47% 48% VICO Indonesia Engaging with Local Communities
Land Access • VICO needs to purchase and build 80 to 100 new well sites a year • Each location can require up to 2,000 truck loads of material and 3 months to build and pile. • Many locations require new roads. Our 40 years of experience ensures our land survey, acquisition and construction team works with the local community to ensure construction activities occur in a way that avoids disruption and benefits the area. VICO Indonesia Engaging with Local Communities
Re-greening After drilling VICO undertakes a re-greening exercise to restore the natural vegetation. VICO Indonesia Engaging with Local Communities
Rig Technology 1. Many fewer loads to move. 2. Faster rig- up time. 3. Less rig footprint and smaller well site CBM Rig size. 4. Reduced height. 5. Automation – less people. Conventional Rig 6. Quieter. 1/3 HH-75 well site: 82M m x 57m Kutai- 3 well site: 165m x 90m VICO Indonesia Engaging with Local Communities
Artificial Lift Pump Technologies Linear rod pumps (LRPs) vs Beam Pumps VICO LRP Minimal exposed working parts Quieter, less visual impact LRP in parking lot in US Beam Pump – large visual signature, noisy and many exposed moving parts. VICO Indonesia Engaging with Local Communities
Overlap with Coal Mining Coal mining activities are frequently in the same area as VICO activities. VICO works with coal mining companies to establish MOUs defining mining no-go areas and cooperation on roads and access issues. VICO Indonesia Engaging with Local Communities
Caring for our Communities VICO received a CSR award for best practice supporting local rubber farmers from Harian Seputar Indonesia (SINDO) SKKMIGAS standard (PTK 017) governs public relations and community affairs VICO Indonesia Engaging with Local Communities
CBM to Electricity VICO is now supplying CBM gas to PLN. The electricity from CBM gas powers more than 1,000 homes in East Kalimantan. This is the first CBM to Electricity Project in Indonesia. VICO Indonesia Engaging with Local Communities
Development with respect BP San Juan field in an area of outstanding natural beauty in the US VICO aspires to achieve development of Indonesian oil and gas resources with respect for local communities and the environment. VICO Indonesia Engaging with Local Communities
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