Extension of West Madura contract to be decided this month

The government will decide this month on the extension of the contract on the West Madura oil and gas block in East Java, but it is still uncertain whether the new contract will be given to current operator Kodeco or Pertamina.

Director General of Oil and Gas Evita Legowo said in Jakarta on Tuesday that the government was still calculating the economic value of the oil and gas block to be used as the basis in deciding the future contractor of the block.

?We hope this month the extension of the contract will be signed,? she said following a hearing with the House of Representatives? Commission VII.

The West Madura contract expires in May 2011. Under the existing contract, Pertamina has a 50 percent stake in the block, its partners Kodeco and CNOOC of China hold 25 percent, respectively. Kodeco is the operator of the block despite its minority position.

Pertamina has proposed to the government that it become the operator of the block replacing Kodeco. At present, the block produces about 14,000 barrels of oil per day and 92 million standard cubic feet per day. (*)