Auction of Riau's MFL oil block delayed again

The auction of the Block Mountain Front Langgak (MFL) oil block in Riau has been delayed again due to the absence of a letter from the ministry of home affairs on the legal status of the field, Bisnis Indonesia reported on Wednesday.

"We are still waiting for a letter from the ministry of home affairs to clarify its legal status," R. Priyono, the director general of oil and gas at the ministry of energy and mineral resources, said on Tuesday.

The local government of Riau planned to auction the MFL oil block worth about US$65 million last month.

Earlier a source at the ministry of energy and mineral resources said that the operation of the oil block -- part of the Mountain Front Kuantan (MFK) oil block would be carried out under cost and fee contract instead of the production sharing contract commonly used in most of the country's oil blocks.

The MFL oil block was part of the Mountain Front Kuantan (MFK) oil block formerly owned by Chevron Pacific Indonesia (CPI). The MFK block was then divided into two parts - the MFK and the MFL ? to meet the request of the two regencies which had both claimed the ownership of the oil block. (*)