BP says E. Java block contract extension imminent

Anglo-American oil giant BP Plc. said on Monday that contract extension of its Kangean gas block offshore East java is imminent and after the government and the house of representative seen to have approved the extension of the block.

?What I heard is that the government and the house have given green light for the extension and we are now waiting for terms and condition set by the government,? said BP Indonesia president Bill Schrader.

The approval would give justification for BP to develop Terang-Sirasun gas field in the block, which is known to contain around 1 TCF of recoverable gas reserve and will help easing gas supply shortage in East Java.

He, however, did not say the period of the contract extension, but normally, a block?s contract extension is for 20 years. BP?s contract on Kangean block would have been expire in 2010.

The company currently operates Pagerungan gas field, which supplies gas to East Java. Gas reserves in the field is depleting.(alex)