The Jakarta Post reported that Indonesia's publicly listed oil and gas company PT Medco Energi Internasional plans to spend USD 40 million on exploration activities on an oil block in Libya in 2010.

Mr Lukman Mahfoedz operational director of Medco said that the block, called Area 47, would require as much as USD 80 million for exploration activities this year. He added that "Medco will cover half of the required funds and we will finance this from our internal sources."

He said that the money would be used to fund a feasibility study and exploration. He added that "We will focus on appraisal and exploration activities, including drilling three more exploration wells in addition to the 21 wells we have drilled already."

In an earlier press statement, Medco said that the drilling program for this year will also include the completion and testing of three previously drilled wells, which were suspended.

Area 47 is estimated to have contingent reserves of 307 million barrels of oil. Earlier, Medco teamed up with Canada based Verenex Energy Inc to develop the block with Verenex appointed as the operator. But, since December 2009, the Libyan Investment Authority has acquired Verenex’s participating interest in the block.

Following the acquisition of Verenex’s interest in the block, Medco was appointed as the block operator for exploration activity starting in April 1st 2010.

Medco said that the company and LIA were now in the final stages of seeking a declaration of commerciality from Libya’s National Oil Corporation for the discoveries made in the area.

(Sourced from www.thejakartapost.com)