ExxonMobil raises compensation payment for Cepu oil field
Wednesday, April 30 2003 - 03:58 AM WIB
"The compensation commitment is higher than the $40 million proposed earlier but it is still far lower from the level demanded by Pertamina," the minister was quoted as saying by Bisnis Indonesia daily.
The minister said that the negotiation between Pertamina and ExxonMobil were still going on after the two companies reached agreements in some important aspects related to the extension of the Cepu oil contract.
The oil field was formerly owned by former president Soeharto?s youngest son Hutomo Mandala Putra alias Tommy. Humpuss sold 49 percent ownership in the oil block to Ampolex Ltd in 1997 and the other 51 percent in to ExxonMobil?s subsidiary Mobil Cepu Ltd in 2000 following the fall of the former authoritarian leader after more than 30 years in power. Ampolex later sold its ownership to Mobil Cepu making the latter as the sole owner of the oil block.
Pertamina, however, demanded ExxonMobil to pay a cash of about US$400 million as the compensation for the earlier extension of the contract. But ExxonMobil only agreed to pay about US$40 million. Pertamina also demanded an increase in its interest in the Cepu oil field to 17 percent from the current 10 percent as part of the compensation.
The Cepu oil field, according to ExxonMobil?s finding, contains 735 million barrels of crude oil and 5.9 billion cubic of gas. (*)