Big firms eye concessions in east Indonesia

The current tender of 31 oil and gas blocks has attracted a number of big firms with most of them particularly interested in the concessions in east Indonesia, a senior official at the Ministry of Energy and Mineral Resources said on Tuesday.

"Many big firms rush to east Indonesia. Its seas are attractive. They are looking for virgin areas. Many firms are interested to look for oil there," Edi Hermantoro, the ministry's director of upstream oil and gas business supervision, said.

The companies include Hess Corporation, Total S.A, Inpex and Royal Dutch Shell, he said.

"We hope to announce the results of the tender during the IPA (Indonesian Petroleum Association) conference," he said.

East Indonesia is generally less developed compared to west Indonesia and some companies have found major hydrocarbon resources in the area, including gas deposit in the area near the Tangguh LNG plant project in West Papua. The Tangguh gas discovery has added to the attractiveness of the area, Edi said.

In October last year, the government announced tender of 31 blocks, including 15 offered through regular tender mechanism and 16 through direct offer.

Interested companies have until March 31 to submit their bidding documents and the winners will be announced in mid-June 2009, Edi said.

According to Edi, big companies prefer blocks offered through regular tender "because they have big budget". Companies eyeing blocks offered through direct offer are particularly interested to carry out joint study on the blocks.

Edi further said the government planned to announce the second round of tender of 2009 during the IPA conference.

"Around 20 blocks will be offered in the second round tender," he said. (Godang)