Govt has no plan to delay transfer of CPP operation

The government does not have any plan to delay the transfer of the Coastal Plain Pekanbaru (CPP) oil field from Caltex Pacific Indonesia to the new operator, Bisnis Indonesia reported on Friday.

"There is no delay in the transfer of the CPP oil block. The plan will be carried on August 8 as scheduled," Director General of Oil and Gas Rachmat Sudibyo was quoted as saying by the newspaper.

He said that if the transfer of the operation and management of the oil block was delayed as required by Riau governor, Caltex should have another permit to extend its contract. "It will take much longer time," he added.

The CPP oil block is part of Caltex Pacific Indonesia?s oil concession areas in Riau. The oil block will, however, be transferred to a consortium of Pertamina and Bumi Siak Pusako in August (this month) due to the end of its contract on the oil field. Caltex?s contract actually expired last year but it was prolonged to another one year awaiting for the preparation of the new operator

Riau Governor Saleh Djasit recently asked the Ministry of Energy and Mineral Resources and state owned oil and gas company Pertamina to delay the transfer of Coastal Plain Pekanbaru (CPP) oil block to the new operator.

In his letter dated July 22, 2002, the governor wanted the signing of the production sharing contract to a consortium of Pertamina and Bumi Siak to be delayed until the problem related to the ownership of Bumi Siak was settled.

Bumi Siak is jointly owned by the provincial administration of Riau and the province?s four regencies. However, the problem related to the percentage of shares that must be owed by each shareholder has not been resolved.

At present, the oil block produces 40,000 barrels per day, far lower than 70,000 barrels per day in the previous years. Caltex initially promised to increase the production to 50,000 barrels per day during the one year extended period. But the company failed to keep its promise. (*)