Exxon's status in Natuna still unclear

The status of American firm ExxonMobil's contract on the Natuna D Alpha block remains unclear, posing an obstacle for state owned oil and gas firm PT Pertamina to develop the gas rich block in South China Sea.

The government has announced the termination of ExxonMobil's contract over the block and the transfer of the ownership of the block to Pertamina. Normally, a contractor will return its block, including technical data, to the government if its contract has been terminated, the paper quoted Director General of Oil and Gas at the Ministry of Energy and Mineral Resources Evita Legowo as saying on Tuesday.

Thus far, however, Pertamina has yet to receive technical data on the block, according to Evita.

The government, Pertamina and ExxonMobil need to sit together to clarify the issue, she said.

The dispute over the D Alpha block surfaced several years ago when the government, which was angry over the fact that American firm had yet to start developing the block, announced that its contract on the block had expired in 2005. The firm however insisted it still has rights over the block because it has extended the contract through 2009. Under the contract, ExxonMobil has 76 stake in the block with Pertamina as partner having the remaining 24 percent.

In a Cabinet meeting in February this year, the government decided to terminate ExxonMobil's contract. It was followed by a letter sent by Minister of Energy and Mineral Resources Purnomo Yusgiantoro in June this year, assigning Pertamina to develop the block.

Pertamina then invited investors to become partners to develop the block. The talks with the potential partners were hampered by the fact that Pertamina had no technical data on the block.

Edi Hermantoro, the ministry's director of oil and gas upstream business supervision, said oil and gas upstream regulatory body BPMIGAS should have issued a letter clarifying the status of the Aplha D block.

"Thus far, we haven't received such letter," Edi said.

ExxonMobil Indonesia's Vice President for External Relations Maman Budiman refused to comment about the issue, noting however the American firm was ready to team up with Pertamina as well as its potential partners to develop the block. (Bernard)