EWC interested in extension of Sengkang block contract

By Febry Silaban

ASX-listed Energy World Corporation through subsidiary Energy Equity Epic (Sengkang) Pty. Ltd. (EEES) has expressed interest for an extension of its current contract over the Sengkang block in South Sulawesi Province which is set to expire on October 23, 2022.

This was revealed in a letter dated June 7, 2017 sent by the company to the Directorate General of Oil and Gas at the Ministry of Energy and Mineral Resources, a copy of which was obtained by Petromindo.com on Wednesday.

?We hereby would like to convey our interest to obtain the extension of Sengkang production sharing contract (PSC) as offered ?,? said Andi Riyanto, President Director of EEES in the letter.

The company issued the letter in response to a May 18 letter sent by the directorate requesting the company to make a statement of interest before the end of this year if it wishes to seek for an extension of the current contract so as to help speed up government decision regarding the future of the Sengkang PSC.

?In order to achieve the approval of PSC extension we have prepared programs which will cover both exploration and development of the Sengkang PSC to maximize the gas produced from within the PSC area that can be commercialized either for the continuity of gas distribution for electricity in South Sulawesi, sustainability of gas distribution for domestic households in Sengkang and also for development of Sengkang gas distribution to Eastern Indonesia,? Andi said, adding that EEEs is ready to apply the gross split mechanism in the Sengkang production sharing contract.

He said that a complete proposal on the contract extension will be submitted later on in accordance with existing regulations and laws.

According to existing regulations, upstream companies can apply for contract extension 10 years prior to its expiry at the soonest, or two years prior to expiry at the latest.

EEES currently owns 100 percent of the Sengkang PSC.

Editing by Reiner Simanjuntak