Government allocates 10% interest in ONWJ block to West Java

The government has finally decided to allocate 10 percent interest in the ONWJ block in West Java to a company owned by the provincial administration, Bisnis Indonesia reported Wednesday.

The paper quoted Director for Upstream Oil and Gas Management Djoko Siswanto as saying that the decision was taken during a meeting on July 30 between the central government, the provincial government, and the shareholders of the block. ?It has been confirmed to (give) 10 percent (to West Java),? he said, adding that a formal letter on the decision has yet to be sent to the provincial administration.

The existing contract over the ONWJ block will expire in 2017. The government has recently extended the contract with PT Pertamina Hulu Energi (PHE), the operator of the block, obtaining a greater stake of 73.5 percent (from 58.25% previously), while IDX-listed PT Energi Mega Persada Tbk?s (EMP) interest down to 24 percent from 36.75percent, and PT Risco Energy ONWJ Ltd (Kupfec) 2.5 percent.

The interest of the aforementioned shareholders in the ONWJ block will be reduced to accommodate the 10 percent allocation for West Java. As reported previously, PHE will allocate 7.35 percent interest, EMP 2.4 percent, and Kupfec 0.25 percent.

Djoko, however, said it has yet to be decided whether Kupfec will also be required to reduce its interest. (*)