E. Kalimantan gets 10% PI in Mahakam block

The central government has officially handed over a 10 percent participating interest (PI) in the gas-rich Mahakam block to the East Kalimantan government.

The Ministry of Energy and Mineral Resources said in a press release that a ceremony was held on Tuesday to symbolically hand over the PI. The transfer of the interest in the block is line with the stipulation set under the Minister of Energy and Mineral Resources Regulation No 15/2015.

East Kalimantan Governor Awang Faroek welcomes the government?s decision to hand over the 10 percent PI in the block to the local administration, saying that it has long been expected by the people in the province, where the block is located. ?I?m very happy ? We really had been hoping for the PI to allow us to participate in managing our resources,? he said at the ceremony as quoted by the press release.

No further details were provided.

The Mahakam block has been equally owned by French firm Total and Japanese firm Inpex Corp, whose contract is set to expire at the end of 2017.

The government in June decided to transfer 70 percent of the interest in the block to state-owned oil and gas firm PT Pertamina when the current contract expires, with the remaining 30 percent to be given to Total and Inpex.

Editing by Reiner Simanjuntak