BPMIGAS cuts down cost recovery budget

Upstream authority BPMIGAS has revised the budget amount of the cost recovery scheme to reimburse oil and gas production sharing contractors for exploration spending, as part of the government?s retrenchment program, Kontan reported Monday.

BPMIGAS spokesman Gde Pradnyana said in Jakarta last week that the cost recovery budget had been lowered from US$17.4 billion to $15.1 billion. However, the target for oil and gas revenues in 2012 was raised to $56.3 billion, which comprise $32.2 billion for government as state revenues and $8.9 billion for contractors.

The target for oil and gas revenues was initially fixed at $53.7 billion, of which $28 billion for the government and $8.3 billion for contractors.

The cost recovery program is designed to reimburse oil firms for exploration and production as part of the production sharing contract in the exploration and production. (*)