Govt has taken over PSC tendering from Pertamina
Monday, December 11 2000 - 04:00 AM WIB
The government has taken over the tendering of production sharing contract (PSC) to oil and gas contractors from state oil company Pertamina since Nov. 14, 2000, or earlier than the initial schedule of Jan. 1, 2001.
Pertamina's director of exploration and production Gatot Karyoso Wiroyudo revealed over the weekend that the government, through the director general of oil and gas at the Ministry of Energy and Mineral Resources, Rachmat Sudibyo, had sent a letter to Pertamina, informing the state oil and gas company about the takeover of tendering authority by the government from Pertamina.
"PSC working fields being negotiated between Pertamina and the contractors must have been sealed by Nov. 14, 2000. After that date, everything will be taken care by the government," said Gatot, who was accompanied the head of Pertamina's Planning and Management Portfolio division, Eddy Purwanto.
Gatot said that Pertamina could complete at least five contracts on time. They included three PSC contracts, namely those for Kuntan blocks, and two technical assistance contracts (TAC), namely TAC for Telaga Said and Sukaraja fields.
Nevertheless, Gatot revealed that a number of PSC contracts under negotiation between Pertamina and the contractors could not be completed on time, and therefore, the handling of these contracts were now transferred to the government.
"We handed over a number of contracts that could not be completed by Nov. 14, 2000 to the government," said Gatot, who was former chairman of Pertamina's Foreign Contractors Supervising Agency (BPPKA).
This takeover of the tendering of PSC fields by the government is certainly ahead of the government's initial schedule of Jan. 1, 2001.
Earlier, the director of exploration and production at the Ministry of Energy and Mineral Resources, Kardaya Warnika, said that the government would take over the awarding of PSC to oil and gas contractors from Pertamina starting Jan. 1, 2001.
He explained that the takeover in PSC licensing served as an effort to reduce Pertamina's monopoly rights in the oil and gas sector and to reduce graft practices in the awarding of PSC contracts.
Kardaya noted that the legal basis for the takeover was Law No. 44/1960 on mining that stipulates the contractual authority on gas and oil sector lies with the government, and not with state-owned business entity. (*)