BPMIGAS says Caltex must return 2.5 million barrels of oil to government

BPMIGAS, government’s agency in charge of oil and gas exploration and production, revealed that the state has lost its share of 2.5 million barrels of crude oil from Bekasap oil field, Bisnis Indonesia newspaper reported on Tuesday.

Bekasap oil field is operated by PT Caltex Pacific Indonesia (CPI).

“BPMIGAS told PT Caltex Pacific Indonesia that there was a miscalculation of crude oil from Bekasap oil field and to return 2.5 million barrels of crude oil or US$70.81 million to the state,” BPMIGAS chief Rachmat Soedibjo said during a hearing with House of Representatives’ Commission VIII in Jakarta on Monday.

Rachmat didn’t disclose full details about the case involving CPI.

But a source revealed Bisnis Indonesia that BPMIGAS’ claim regarding Bekasap oil field was actually a discrepancy in the calculation that has accumulated for several years.

During the revaluation of CPI’s contract for Bekasap oil field, it became clear that there was a mistake in the calculation of production sharing between the government and CPI, the source added.

This finding was already included in the state audit agency BPK’s report and became an obligation for CPI to return the state’s share, the source said.

Previously, the House also questioned the oil and gas barter deal between ConocoPhillips and CPI, which might cause a loss of about $36 million to the state coffers.

The loss could occur because the sale of the oil received by Conoco from CPI in exchange for its gas was not reported as part of Conoco's oil production that should be shared with the government.

The total loss from the barter deal which has in place for five years could reach $36 million.

Caltex has for years received gas from Conoco's fields in South Sumatra to support the enhanced oil recovery program of its oil fields in Riau. In return, Conoco receives crude oil from Caltex.

But BPMIGAS has strongly defended the CPI and ConocoPhillips barter deal, saying that the controversial barter deal has not caused any financial loss to the state.

It said that the government’s revenue coming from CPI’s oil production would not be affected by the barter deal because the cost structure of the oil company remained the same despite the swap.

Djusril Djusan, a member of Commission VIII, has asked the BPMIGAS to tighten the supervision of production sharing contractors’ operations in order to avoid losses to the state from oil and gas sector. (*)