Chevron won?t seek for extension of Attaka block contract

By Bernard Loebs

Chevron Indonesia has decided it will not seek for an extension of contract over the Attaka block in East Kalimantan when it expires in 2017.

M.I. Zikrullah, a deputy at upstream oil and gas authority SKK Migas, said that Chevron is no longer interested in developing the block.

Block operator Inpex Corp has earlier made similar statement. Inpex Corp Spokesman Usman Slamet said that when the Attaka block contract expires next year, the company would return the asset to the government of Indonesia.

The Attaka PSC is located in the Makassar Strait, approximately 19 km offshore from Tanjung Santan and northeast of the Mahakam Delta in East Kalimantan. The block was awarded to Inpex in March 31, 1967. In 1991, Inpex was granted a 20-year extension of the Attaka PSC effective from March 31, 1997 through March 30, 2017 after agreeing to add spending of US$30 million for exploration over six years.

The PSC is now operated by Inpex with 50 percent working interest, in partnership with Chevron Indonesia Company (formerly Unocal Indonesia Company) which holds the remaining 50 percent.

The Attaka PSC contains the giant Attaka field, which was discovered in May 1970 and developed as the first offshore field in Indonesia, with first crude oil and natural gas production occurring in November 1972 from six wellhead platforms.

The East Kalimantan provincial administration has said it wanted to have a participating interest in the Attaka PSC.

Editing by Reiner Simanjuntak