Medco Energi Acquires 10% Stake in Four Eni Indonesia Gas Blocks

PT Medco Energi Internasional has agreed to acquire a 10% non-operating participating interest in four oil and gas blocks in the Kutai Basin, East Kalimantan, from Eni. The deal expands the company's upstream portfolio and supports its long-term presence in the Indonesian LNG supply chain.

The four blocks, Muara Bakau, Ganal, West Ganal, and East Ganal, are currently operated by Searah, a joint venture between Italy’s Eni and Malaysia’s Petronas. The assets include the Geliga gas field, which holds an estimated 5 trillion cubic feet of natural gas and 300 million barrels of condensate.

"The transaction also strengthens our long-term production base through producing assets and large-scale gas development projects," said Ronald Gunawan, CEO of Medco Energi, in a statement regarding the acquisition.

Strategic Rationale for the Kutai Basin

The acquisition allows Medco Energi to secure a foothold in a hydrocarbon region of Indonesia. By entering the Kutai Basin, the company gains exposure to gas reserves intended to support domestic energy demand and export-oriented LNG projects.

For Medco Energi, the addition of these blocks balances its existing portfolio with assets that offer both immediate production and long-term development potential. The inclusion of the Geliga field aligns with the company's goal of increasing its gas-weighted production profile as the regional energy market shifts toward cleaner-burning fuels.

Regulatory and Operational Context

While the agreement has been reached between the parties, the transaction remains subject to customary regulatory approvals from the Indonesian government.

As a non-operating partner, Medco Energi will participate in the financial and production benefits of the blocks without assuming the lead operational responsibilities held by Searah. This structure allows the company to participate in capital-intensive projects while maintaining a disciplined approach to its overall capital expenditure budget.