Government terminates two PSCs

By Bernard Loebs

Courtesy of SKK Migas

The government had at the end of July terminated contracts of two conventional oil and gas working areas (WKs) as the contractors failed to make significant progress in their exploration commitments.

Jaffee Arizon Suardin, Deputy for Development at upstream oil and gas authority SKK Migas said on Friday that the two are Air Komering WK and Bunga Mas WK, both located in South Sumatra Province.

?The two operators have not shown any progress in implementing their exploration commitment,? he told Petromindo.com, but did not provide further details.

The Bungamas PSC, which covers an area of 2,233 sq km onshore South Sumatra Province, was awarded to PT Bunga Mas Energi on October 7, 2005 for a term of 30 years.

Meanwhile, the Air Komering PSC was owned by PT Cahaya Batu Raja Blok, a subsidiary of IDX-listed Capitalinc Investment Tbk. In May of this year, Capitalinc announced plan to drill the AK-2 delineation well in Air Komering PSC in September. In 2015, the company drilled AK-1 wildcat well which flowed 5.4 MMCFD from upper zone and 3.3MMCFD from lower zone.

Editing by Reiner Simanjuntak