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Jakarta Post

Government appoints 5 operators for $292m oil and gas blocks

  • Stefanno Reinard Sulaiman

    The Jakarta Post

Jakarta   /   Mon, June 11, 2018   /   09:34 am
 Government appoints 5 operators for $292m oil and gas blocks Deputy Energy and Mineral Resources Minister Arcandra Tahar (JP/Dhoni Setiawan)

The government has appointed operators to manage five of six oil and gas blocks, the contracts on which expire in 2020. The blocks will be operated using the gross split production sharing scheme.

The five blocks are the Brantas Block managed by Lapindo Brantas Inc., the Malacca Strait block by EMP Malacca Strait SA, the Kepala Burung block A by Petrogas (Basin) Ltd, the Salawati block by Petrogas and the South Jambi block by Petrochina.

For the Makassar Strait Offshore-A Block, the contract for which also expires in 2020, Deputy Energy and Mineral Resources Minister Arcandra Tahar said Chevron Makassar Ltd., as the existing operator, was yet to submit an extension proposal due to the Indonesia Deepwater Development (IDD) preparation of the block.

Arcandra told the press on Friday that ministerial decrees for the five blocks had been issued and operators would be assigned no later than one month after the issuance of the decrees.

The companies' five-year total investment commitment (before present net value) is US$292 million, while the total signature bonus is $10.5 million.

“Please look at how big their commitments are. It would not happen under the cost recovery scheme,” he said, referring to a scheme that has not been used since early 2017.

Arcandra said the government had yet to sign new contracts on four other blocks on which current the contracts would expire next year.

The four blocks are the Bula block, the Seram-NonBula block, the Pendopo and Raja block and the Jambi Merang block. The latter two will be operated by Pertamina Hulu Energi, the state-energy giant Pertamina’s upstream unit. (bbn)