Govt decides CPP block to be jointly managed by Riau, Pertamina

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said on Wednesday that the government has decided that the Riau administration and the state-owned oil and gas firm Pertamina will jointly operate the Coastal Plain Pekanbaru (CPP) oil block once PT Caltex Pacific Indonesia (CPI) ends its contract in August 2002.

Speaking in a hearing with the House of Representatives commission VIII on energy and mining, Purnomo said that a consortium would be set up to facilitate the plan, and that Riau had basically agreed over the plan.

He, however, said that Riau and Pertamina have yet to reach agreement on the amount of shares each must hold in the new consortium.

He said that Riau wants a 55 percent stake, with the remaining 45 percent in the hands of Pertamina. The later wants an equal ownership.

A special team from Riau is currently in negotiation with the Pertamina team.

The CPP block is currently being managed by PT Caltex Pacific Indonesia (CPI), which was supposed to end its contract in August this year but was extended for another year until 2002 after the central government and the Riau administration failed to reach a compromise on who would gain control over the oil block once CPI?s term expires. (Godang)