Abstract

Historical equilibrium for oil prices seems to have centered around $20/bbl. Previous price spikes favors the supply side the Yom Kippur War increased the price as did the Iranian Revolution. The 2008 spike in price led to a strong synchronized economic growth and a historically low spare capacity. The recent price collapse led to a banking crisis when in turn led to a broader economy which impacted demand and caused commodity prices to continue to decline. Demand side influences include population and population growth as well as economic growth, all of which continue to grow. Supply challenges include actual size of existing reserves, the average discovery size, declining rates and the marginal cost of new developments. Lundin Petroleum has a bright future with strong operating cash flow, limited capital expenditures, low gearing and available liquidity and a solid asset base with growth opportunities. Lundin in Southeast Asia is focusing on building “core” exploration areas, exploring within proven petroleum systems with a focus on under-explored basins with limited legacy date as well as improving technical understanding by the application of 3D seismic and acquiring acreage with Lundin operatorship and seeking strategic partners.

Keywords: Lematang • Banyumas • Blora • Salawati Basin • Salawati Island • Sareba • Block E • Cakalang • PM 308A • PM 308B • Penyu • Rangkas • Baronang • Sokang • Block 06/94 • SB303

Presented at: 2009 South East Asia Petroleum Exploration Society (SEAPEX) Conference, Singapore, 2009