Government wants Chevron to soon decide on Rokan block contract

The Ministry of Energy and Mineral Resources is asking PT Chevron Pacific Indonesia (CPI) to make decision sooner on whether it would request for an extension of its current contract over the Rokan block in Riau Province which is set to expire in 2021.

This was said by Upstream Oil and Gas Development Director at the ministry, Tunggal, in a statement issued on Saturday. He said that according to Government Regulation No 35/2004 on upstream oil and gas activities, contractors can apply for extension of their contracts at the latest two years prior to their expiry date. But Tunggal said the government expects Chevron to provide certainty sooner on whether it will request for an extension of its contract over the Rokan block to allow more time for the government to make evaluation. ?According to the regulation, (request for extension can be made) two years prior to its expiry, but we expect it sooner,? he said.

Chevron has been operating the Rokan block since 1971. The Riau administration has demanded for a 10 percent participating interest in the block when the current contract expires. Some officials have also said that there is possibility for the government to transfer operatorship of the block to state-owned oil and gas firm PT Pertamina when the current contract expires as is with the case of the Mahakam block, in East Kalimantan, which will be transferred to Pertamina when the contract of Total EP Indonesie expires later this year. Under this scenario, Chevron can have participating interest in the block under a new production sharing contract.

The Rokan block, 100 percent owned by CPI, is home to the large Duri, Minas, and Bekasap fields. Duri is one of the largest steam flood operations in the world.

Editing by Reiner Simanjuntak