Bojonegoro authority asked not to disturb PetroChina's activities

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said that the central government had strongly warned the Bojonegoro regency's authority in East Java not to disturb the exploration activities of Chinese oil company PetroChina in the regency, Kompas reported on Tuesday.

Purnomo said that the regency's recent action to halt the exploration activities of the Chinese firm could further damage the investment climate in the country's oil exploration activities.

"The problem should be settled amicably. And we hope the regency will no longer interfere with PetroChina's activities," he said, adding that the company which had stopped its exploration activities for two weeks should be allowed to resume its operation.

PetroChina in a joint venture with state oil and gas company Pertamina now operates the Sukowati field in the regency. The field started operation in August last year with an output of 7.000 barrels per day.

The regency's spokesman Kamsoeni admitted that the regency administration had asked PetroChina to stop exploration activities at its concession area in the regency after the company refused to involve the local government in the company's management.

He said that the local government had demanded at least 10 percent stake in the Sukowati field, but the demand was turned down by PetroChina, who argued that the field was not a new development field. Under the exiting regulations, local administrations can demand a 10 percent stake in the new oil fields in their respective areas. (*)