Govt sets requirement for new operator of Block A gas field

Any oil and gas companies interested in developing the Block A gas field in Aceh should guarantee that they will be capable of commencing production activities by 2008, Neraca reported on Tuesday.

"New operator of the Block A gas field should be able to produce gas by 2008. If not, the government will oppose it," said Kardaya Warnika, chairman of BP Migas, the government's agency in charge of oil and gas exploration and production activities.

The guarantee to carry out production by 2008 is the main requirement that should be met by any companies interested to take over the oil block from the current operator Conoco Philips, he added.

Kardaya Warnika said that the government would also maintain the existing production sharing contract of 52-48 ratio, in which 52 percent of the output would go to the government and the remainder to the operator.

Earlier reports said that Conoco Philips will quit the gas field and plans to sell its working interest to other companies because it felt the development of the gas field will be too costly.

Kardaya said although it is the rights of Conoco Philips to sell its working interest in the Block A gas field, the government has the rights to oppose the buyer if it does not meet its requirement. (*)