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View all search resultsOil and gas blocks under the gavel and up for grabs
The government officially offered 21 oil and gas blocks located mostly in eastern parts of Indonesia to potential investors in its first round of block tender this year
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T
he government officially offered 21 oil and gas blocks located mostly in eastern parts of Indonesia to potential investors in its first round of block tender this year.
The Energy and Mineral Resources Ministry's oil and gas chief Edy Hermantoro said in Jakarta on Friday that the blocks included two unconventional shale gas blocks to be offered to the country's oil and gas companies.
'We hope that the addition of the oil and gas blocks may have a significant contribution in the future,' he said on the sidelines of the closing ceremony of the 37th Indonesian Petroleum Association (IPA) convention at the Jakarta Convention Center.
'The access for the bid documents is expected to begin this June.'
The government, he said, expected the blocks would eventually add as much as 3.1 billion barrels of crude oil and 57.6 trillion cubic feet of natural gas to resources.
The conventional oil and gas blocks include the Sumba Sawu block and East Seringapatam block off Sumba Island in East Nusa Tenggara; East Abadi block, West Abadi block and Yamdena block off South Maluku Island; Palmerah Baru block, which is located onshore in Jambi, South Sumatra; Sakti block off the north coast Central Java and East Java; North Madura II block and North East Madura VI block, both located off the north coast of Madura Island; and Anugerah block off East Java cast.
The East Bontang block, located on- and offshore East Kalimantan is the home of the largest gas producer in Indonesia France-based Total E&P Indonesia, is also up for grabs.
Other blocks include North Adang block in Makassar Strait, South Sulawesi I block and Sulawesi II block, Southeast Sulawesi I block, Southeast Sulawesi II block ' all are located off Sulawesi Island.
South Aru block, located off the Aru Island in Maluku and Bird's Head block off north coast of West Papua and an onshore block in Merauke, Papua, are also offered to the oil and gas companies.
The two nonconventional shale gas blocks are the Barumun block in North Sumatra and Riau, as well as the West Tanjung block in Central Kalimantan.
Shale gas is a natural gas produced from shale rocks and other geological formations by injecting water and chemicals into the rocks through a technique known as hydraulic fracturing.
On Wednesday, Indonesia's biggest energy firm, PT Pertamina, officially tapped into shale gas exploration by signing the production-sharing contract for the Sumbagut block in North Sumatra in Jakarta.
Pertamina committed to spend US$7.8 billion to explore the Sumbagut block, aiming to produce around 40 million meters standard cubic feet per day (mmscfd) to 100 mmscfd by 2020.
In addition, Edy Hermantoro explained to reporters that the government would seek commitment from future investors interested in developing onshore blocks with low-risk exploration activities.
The government are offering attractive treatment to investors willing to begin explorations in the archipelago's frontier areas, which have high-risk of failing during the exploration period.
Earlier this year, several large companies decided to return their blocks after years of unprofitable exploration. US-based ExxonMobil and Norway's Statoil are among the major players giving up exploration work.
Indonesia, a former oil exporter in Southeast Asia, and former member of the Organization of the Petroleum Exporting Countries (OPEC), aims to reach a production of 1.01 million barrel of crude oil per day (bpd) in 2014, current production dropped to 830,000 bpd as a result of aging oil fields.
