Govt gives green light for Pertamina to start investment in Mahakam next year
Tuesday, July 12 2016 - 02:12 AM WIB
The paper quoted ministry spokesman Sujatmiko as saying that the existing Minister of Energy and Mineral Resources Regulation No 15/2015 is sufficient as the legal umbrella to facilitate Pertamina?s plan, and therefore there?s no need to issue a new special regulation.
He said that what is required from Pertamina is to provide a clear work plan to the ministry and upstream oil and gas authority SKK Migas before making the investment in Mahakam block.
The government has decided to transfer the Mahakam block to Pertamina when the existing contract expires at the end of 2017. Existing investors Total and Inpex are given opportunity to have a combined 30 percent stake in the block after the current contract expires, but the two firms have yet to respond to the offer.
Pertamina President Director Dwi Sutjipto previously said that his company wanted to start making investment in Mahakam block, in East Kalimantan, next year to help avoid production decline in the block, as the existing investors have reduced investment over the past two years.
Hardy Pramono, President and General Manager at Total E&P Indonesie, the block?s current operator, however, said that the investment reduction in the Mahakam block is part of efficiency measures taken to help cope with the current oil price drop.
He added for Pertamina to be able to make investment in Mahakam block next year, the state-owned oil and gas firm must obtain approval from SKK Migas and that there must be clear legality. ?Legal umbrella is required, as well as approval from the authority, which is SKK Migas,? he said. (*)