Govt offers local investors two oil, gas blocks

The government is offering two oil and gas blocks previously operated by foreign companies to local investors,a senior official said.

The Investor daily quoted director for production and exploration at the Directorate General of Oil and Gas Novian M. Thaib as saying that the foreign companies' production sharing contract over the two blocks had expired.

The two blocks are: the Mountain Front Kuantan (MFK) block (previously operated by PT Caltex Pacific Indonesia) in Central Sumatra, and the Wailawi block (previously operated by PT Vico Indonesia) in East Kalimantan.

Novia said that the two blocks would be offered to national investors particularly local ones through a cost and fee tender mechanism.

He said that so far, the local administrations had also expressed interest to participate in the tender along with five other local companies bidding for the MFK block and seven other for the Wailawi block. He did not provide the names of the companies.

"This could be a training ground for local companies (in the oil and gas sector)," he said.

He said that the MFK (Caltex obtained contract for the block ain 1975 and it expired in 2004) can still produced oil for another 10 years with a daily capacity of about 548 barrel per day.

He added that the Wailawi block can still produced gas for another 7-8 years with a capacity of "hundreds of million cubic feet per day."(*)