Oil Spill to Cost Pertamina Hundreds of Billions of Rupiah

Oil spill to cost Pertamina hundreds of billions of rupiah. State oil and gas giant Pertamina has to spend hundreds of billions of rupiah to deal with a broken well that has been spilling oil for more than a month at its Offshore North West Java (ONWJ) Block.

Bayu Satya, the Oil Spill Combat Team (OSCT) Indonesia chairman, said Pertamina needed a large amount of money to rent a new rig that would be used to close the well and equipment to contain the spill.

“The cost of stopping and overcoming the oil spill will be so enormous as a lot will be spent on renting the rig in order to make a relief well and to finance OSCT’s operation. And we don’t know when it will be stopped,” he told The Jakarta Post recently

OSCT, an oil spill management company, is Pertamina’s partner in handling the accident, deploying personnel to operate oil-capture equipment, such as octopus skimmers and oil boom equipment.

Meanwhile, for the mission to close down the broken well, Pertamina hired American well-control company Boots & Coots, which handled the Deepwater Horizon oil spill in the Gulf of Mexico that took 11 lives.

Boots & Coots has the crucial job of stopping the leak, which occurred at one of the three wells located beneath ONWJ’s YY oil and gas field. It is working to drill a relief well that will pave the way for the firm to inject it with cement.

The company is an affiliate of US well service contractor Halliburton, which is the subcontractor for the operation at the YY field, where oil was first expected to be produced in September.

Pertamina Hulu Energi (PHE), the ONWJ contractor, reported Wednesday that the process of closing the well was ongoing with the relief well’s drilling depth sitting at 19.5 percent of the target.

“The drilling of a relief well, called the YYA1-RW, has reached 540 meters whilst the target is 2,765 meters,” PHE spokesperson Ifki Sukarya said in a press statement.

PHE workers, aided by international well control experts, had been drilling a relief well since Aug. 1 to plug the leak at the YY platform, Ifki said.

Karawang Beach incident commander Taufik Adityawarman told reporters on Thursday that the company would need at least 65 days–or until early October–to close down the broken well, which is later than Pertamina’s initial completion time estimate of late September.

“As of today, we are actually two days ahead of schedule. We want this disaster to end,” he said.

He added that authorities had deployed 45 ships to overcome the oil spill, which reached beaches and villages in Karawang and Bekasi, in addition to deploying 4.7 kilometers of static oil boom equipment and four oil skimmers.

Nine areas in Karawang, namely Tanjung Pakis, Segar Jaya, Tambak Sari, Tambak Sumur, Sedari, Cemara Jaya, Sungai Buntu, Pusaka Jaya Utara and Mekar Pohaci, were declared by Pertamina as areas that were impacted by the incident.

PHE president director Meidawati said the company had deployed 37 medical personnel to help locals affected by the oil spill and would pay local fisherfolk at least Rp100,000 each day to aid in the oil recovery effort.

Elsewhere, reports said that two beaches in Bekasi–Bahagia and Bakti–and Thousand Islands regency were also impacted.

A statement from OSCT said that Pertamina had asked for more Pertamina workers to help contain the spill as it had reached the Thousand Islands.

“They asked us whether OSCT has more workers to clean the spill in Thousand Islands. We’ve asked our workers in Papua and in foreign countries and we’re still calculating the cost,” he said.

An estimated 108,000 barrels of oil have spilled into the sea after 36 days since the well broke. The broken well has a capacity of 3,000 barrels of oil per day.

The oil spill was caused by a gas well kick–the release of gas caused by low pressure in a wellbore–on July 12 that worsened two days on.

The kick occurred beneath the ONWJ offshore platform, located 2 km north of Karawang. Oil spill to cost Pertamina hundreds of billions of rupiah (Stefanno Reinard Sulaiman, The Jakarta Post)