Govt hasn?t decided on ConocoPhillips share for Aceh gas

The Government has not decided whether to give ConocoPhillips, the third biggest U.S. oil company, a bigger stake to develop a gas field in the northwestern province of Aceh, The Jakarta Post newspaper reported on Tuesday citing Bloomberg.

?We can?t decide by ourselves,? Indonesia?s Coordinating Minister for Economy Dorodjatun Kuntjoro-Jakti told reporters in Jakarta after a limited Cabinet meeting on Monday.

ConocoPhillips and ExxonMobil Corp. hold a so-called contract in the Block A gas field. ConocoPhillips is also the field?s operator. Under the current contract, the Indonesian government gets 70 percent of the gas produced at the field, leaving the two companies with 30 percent.

The two companies have said their share is too small to make a profit as they have to increase spending to remove high levels of carbon dioxide and sulfur found in the gas.

The field can begin production by 2008 should the next Indonesian government reach an agreement with ConocoPhillips, Dorodjatun said. Susilo Bambang Yudhoyono won Indonesia?s presidential election after the former general garnered support from three fifths of voters, the General Election Commission said on Monday.

Indonesia in February asked ConocoPhillips and ExxonMobil to start developing the Block A field to meet supply shortages at its oldest liquefied natural gas plant.

The field is located in Aceh, a province on the northern top of Sumatra island, where rebels have been fighting for independence since 1976. Indonesia?s government has been trying to win support in Aceh.

Supplies of natural gas to the PT Arun NGL plant fell after Indonesia ordered some of the natural gas produced at another field operated by ExxonMobil to be diverted to fertilizer-makers in the province. (*)