Govt prepares three options for Natuna gas block's future
Tuesday, October 17 2006 - 02:34 AM WIB
Purnomo said that the three options are opening a retender, handing over the contract to state oil and gas company PT Pertamina who owns the first right refusal scheme and renegotiating for drawing up a new contract with ExxonMobil.
The minister asserted that the government would decide which one is the best and which the government will take through a cabinet meeting.
However, he reminded that ExxonMobil should honor the Natuna-D Alpha Block contract which legally has automatically expired because the company failed to meet the terms and conditions in the contract.
Under the contract signed in 2005, ExxonMobil is required to submit a commercial viability study to the government by the end of that year. However, the company failed to meet the conditions which has led to the automatic termination of the contract, he said.
?We do not terminate the contract but we have a strong reason that the contract is automatically terminated based on the contract. It should be underlined that we honor the contract. So, it is not right to say that Indonesia has terminated the contract of ExxonMobil.? he said.
He said that in the document of BP Migas issued on January 18, 2005, it is said that commitment of ExxonMobil is insufficient to avoid the termination of the contract -Production Sharing Contract (PSC) on January 19, 2005.
Exxon?s working interest in the Natuna D-Alpha area is 76 percent, with its partner, state oil and gas company Pertamina owning a 24 percent share in the block. (*)