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Jakarta Post

SKK Migas agrees to transfer oil and gas block from Pertamina to Acehnese company

  • Norman Harsono
    Norman Harsono

    The Jakarta Post

Jakarta   /   Fri, November 29, 2019   /   07:55 pm
SKK Migas agrees to transfer oil and gas block from Pertamina to Acehnese company Pertamina workers converse at an unspecified job site. (Antara/Risky Andrianto)

The government has agreed to transfer the oil and gas B block in Aceh from state-owned oil company Pertamina to a region-owned holding company, PT Pembangunan Aceh (PEMA), says the regional administration.

The Aceh administration said in a statement received by The Jakarta Post on Friday that the agreement was concluded in a closed-door meeting with the Upstream Oil and Gas Regulatory Special Task Force (SKKMigas) in Jakarta on Nov. 14. 

“As per SKKMigas’ request for the Aceh administration to provide the necessary funding by 2020, we are ready to execute the request,” said Aceh's acting governor, Nova Iriansyah.

Aceh, a province that enjoys special political status, has wanted to take over the block since October 2018, when Pertamina Hulu Energi (PHE), an upstream subsidiary of Pertamina, received an extension to operate it.

However, Aceh and SKKMigas have been at odds over the block’s production-sharing contract, whereby the former wanted a cost recovery scheme while the latter enforced a gross split scheme, as mandated by government regulations.

“After negotiations, Pertamina continued to chuckle while enforcing the gross split scheme,” wrote the Aceh administration.