5 KUDs approved to manage old wells

By Demas Simbolon

The government has throughout last year granted approval for 5 Village Cooperatives (KUDs) to manage and produce oil from a total of 280 old wells.

The approval has been given to KUD Mitra Sawit in Sangatta, East Kalimantan (11 wells), KUD Serba Usaha Pribumi Mandiri Mineral dan Energi in Sorong, Papua ( 23), KUD Sumber Pangan in Bojonegoro, East Java (110 wells), KUD Usaha Jaya Bersama in Bojonegoro (114 wells) and KUD Langkat Oil Resources in Langkat, North Sumatra (22 wells).

Old wells are those that had been drilled before 1970 and are no longer in operation by the respective PSC holders.

KUD or regional government-owned firm (BUMD) can operate the wells by submitting a proposal to the PSC Holder and Energy and Mineral Resources Minister cq Director General of Oil and Gas and SK Migas.

KUD or BUMD can start operating the wells under a binding revenue agreement with PSC Holders.

In Indonesia, old wells total 13,824 wells.

Editing by Dadan Wijaksana