Bumi Perdana, Tately to develop CBM project

Local firm PT Bumi Perdana Energy will team up with Dutch firm Tately NV to develop coal bed methane (CBM) resources in Musi Banyuasin, South Sumatra, Investor Daily reported Wednesday.

Bumi Perdana's President Director Andi Gani Nena said in Jakarta Tuesday that the two companies would invest up to US$150 million (about Rp 1.41 trillion) to develop the CBM project on 81,000 hectares of lands.

?Tately has received a contract from the government to develop oil and gas (in the area), while we have the right to develop coal resources (in the area). That's why we form a consortium," he said.

Andi said that the larger part of the investment funds would be used to finance the infrastructure and technology. "We hope the project could be commenced in the third quarter of this year," he said.

According to him, the joint venture is entitled to 45 percent of the production while the government would get the other 55 percent. "The production split for the contractor is quite high as the development of CBM project will be much costly," he said.

Under the existing Indonesian regulation, CBM exploration and exploitation follows Oil and Gas Law. (*)