T

he Energy and Mineral Resources Ministry is planning to open bidding for new oil and gas blocks this year in the face of falling oil price and ongoing uncertainty about the regulator'€™s status.

Upstream director at the ministry'€™s oil and gas directorate general, Naryanto Wagimin, said as many as 12 oil and gas blocks would be up for offer this year.

An official announcement will probably be made this May during an annual event of the Indonesian Petroleum Association.

'€œOut of the total number, four will be offered on a regular basis, four others will be joint study [direct appointment following previous joint studies by companies] and the remaining four will be unconventional blocks,'€ Naryanto said on Monday.

He added that the ministry would be more in-depth so that only committed companies would be selected.

Amid declining national oil production due to depleted fields, the government is struggling to boost exploration activities, partly by offering new working areas, so the country can secure future hydrocarbon supply.

A variety of drawbacks, including challenging locations and prolonged bureaucracy, have hampered the attempt.

Meanwhile, the Upstream Oil and Gas Regulatory Task Force (SKKMigas) is set to terminate the contracts for 41 working areas, mostly due to unsuccessful activities and contractors'€™ failures to meet their commitments to the government.

SKKMigas spokesman Rudianto Rimbono said the regulatory body had sent recommendations to the Energy and Mineral Resources Ministry on the termination of 22 out of the total 41 working areas.

Recommendations of termination for as many as 11 working areas are being made based on contractors'€™ requests and the other 11 are automatic terminations as the exploration period has expired.

The regulatory body, according to Rudianto, is now working to verify proposals from contractors regarding the termination of six working areas. Meanwhile, with regard to the remaining 13 working areas, the body still needs complementary documents from the contractors before making any decisions.

'€œFollowing the terminations, the oil and gas directorate general will decide whether to put them out to tender again or not. However, it is for sure that the blocks are currently passive with no activities,'€ Rudianto said.

Last year, 21 working areas were offered by the government, consisting of 13 conventional blocks and eight unconventional blocks. The total new oil and gas resources of the new blocks are estimated to be at 3.5 billion barrels of oil and 107.7 trillion cubic feet of gas.

Naryanto said the auction process had been completed and the government was prepared to announce the winners of the tenders. However, the unclear status of SKKMigas, following a court ruling, has hampered final decisions on the new blocks.

'€œContractors used to have the contracts with BP Migas. Given the current situation, uncertainty is very high while there are changes in progress in SKKMigas,