SET-listed PTT Exploration and Production Plc (PTTEP), Thailand's only upstream petroleum firm, has quit the East Natuna gas exploration project after finding it no longer worth the commercial investment, according to a company statement released yesterday.
Although the company, which partnered with PT Pertamina and ExxonMobil, had yet to start exploration and production in the Indonesian gas field, PTTEP conducted feasibility studies from time to time as global energy prices rose and fell.
The consortium had conducted a technology and market review (TMR) to explore potential development in the East Natuna block.
"The results of the TMR showed, under market conditions, that commercialising the hydrocarbon resources in this area would be of difficulty considering the level of CO2 and remoteness of the area," PTTEP said. "Therefore, PTTEP chooses not to participate in any further activity in the East Natuna project."
The Indonesian unit of ExxonMobil previously said it "no longer wishes to continue further discussions or activity" involving the East Natuna gas block.
Exxon's exit probably means further delays in developing a field that was first discovered in the 1970s.
Difficulties with East Natuna have included contract disputes and the remoteness of the block, which rests on the southern edge of the South China Sea.
The East Natuna field holds about 46 trillion cubic feet of recoverable gas resources, according to ExxonMobil, though the supply comes with a carbon dioxide content of more than 70%, which raises the cost of extracting usable fuel.
PTTEP has been part of the East Natuna project since 2012. Indonesian state energy firm Pertamina had expected to sign a production-sharing contract with PTTEP and ExxonMobil last year.
PTTEP continues to hold a 11.5% stake in Natuna Sea A, which has a current gross production of 230 million standard cubic feet per day, according to the company statement.
Malaysia's Petronas and France's Total were previously involved with the East Natuna project, but they pulled out.
PTTEP shares closed yesterday on the Stock Exchange of Thailand at 84.50 baht, down 25 satang, in trade worth 308.5 million baht.