Caltex ready to get smaller stake in CPP oil block
Friday, February 25 2000 - 01:30 AM WIB
PT Caltex Pasific Indonesia (CPI) has agreed to get a smaller stake in a joint venture with the state oil compnay Pertamina to operate the Coastal Plains Pekanbaru (CPP) oil block, Minister of Mines and Energy Susilo Bambang Yudhoyono said here on Thursday.
The minister, however, said that the two companies had not yet reached an agreement on the amount of the share that must go to Caltex, which previously insisted to get at least 50 percent in the joint venture.
"I think there has been a change in the ownership position and Caltex has agreed to become a minority shareholder," Bambang said at the Chief Editor Launch.
The government under the former president Soeharto refused to extend the production sharing contract awarded to Caltex to operate the CPP oil block when it expired in August next year. It, instead, asked Pertamina to form a joint venture with Caltex to take over the oil block. The state oil company demanded a 65 percent stake, while Caltex wanted to get at lease 50 percent in the joint venture. The new House of Representatives (DPR), however, insisted that Pertamina, on the behalf of the government, should take majority stake and asked the two companies to also involve Riau in the ownership in the joint venture.
At the gathering, the minister also said that the government had agreed to accommodate the Riau provincial administration's demand to have a stake in the joint venture but that would depend on the province's ability to provide funds.
Riau governor Saleh Djasid said early this week that the province had asked the government to take over a full ownership in the oil block, which produces 80,000 barrels of crude oil per day. The governor also said that the provincial government would no longer involve Caltex if it was given the chance to control the oil block.
Bambang deplored the governor's statement, saying that the government remained committed to involving Caltex in the future operation of the oil block.
He said that the government would accommodate the Riau people's wish to have a stake in the oil block but it was not wise if it demanded a full ownership and took other company instead of Caltex as its partner. (*)