Maluku administration ready to accept participating interest offer in Masela Block

The provincial administration of Maluku is ready to accept a 10 percent participating interest offer in the Lapangan Abadi gas field of the giant Masela gas block after the provincial-owned company teamed up with a third party to form a joint venture firm called PT Maluku Energi Nusantara.

?We are ready in terms of operational, finance, administration and human resources support to participate in the Masela Block,? said Maluku Governor Karel Albert Ralahalu last week in Ambon after a meeting with visiting head of public relations and security of oil and gas regulator BPMIGAS, Agus Suryono, as quoted by BPMIGAS website on Monday.

Also attending the meeting were officials from three PSCs operating in Maluku including Citic Seram Kalrez Petroleum, CNOOC Palung Inpex Masela, and Niko Resources Indonesia, and other BPMIGAS officials.

The Masela Block is currently controlled by Inpex Masela Ltd, which holds a 90 percent interest and acts as the operator. Another company called PT EMP Energi Indonesia, a subsidiary of Jakarta listed oil and gas concern PT Energi Mega Persada Tbk holds the remaining 10 percent stake.

Karel appreciated the support of BPMIGAS in accelerating the process of offering the participating interest to the province. ?It is hoped that (this kind of) active communications will continue in the management of oil and gas resources in Maluku,? he said.

He explained that Maluku holds a huge hydrocarbon potential. Out of the 16 basins located in the province, only one, the Seram Basin, which has already been in production stage. Other basins are still in exploration stage. ?That?s why we support oil and gas investors who wish to operate in Maluku,? Karel said.

Meanwhile, Agus of BPMIGAS explained that further development of the Masela Block was still pending the government?s decision on the type LNG processing facility. The government has yet to decide on whether to build an on shore processing facility or a floating terminal. ?It is still being reviewed by an independent team. It is targeted that a decision will be made in August 2010,? Agus said.

According to the plan, Inpex hopes the Masela Block to start production in 2016, Agus said. Total investment in the strategic project was estimated at about US$10 billion.

Before meeting the Maluku governor, the BPMIGAS and PSC officials met with Maluku Province Police Chief Totoy H. Hendra. Totoy said that the police was committed to help ensure security of oil and gas facilities such as the Masela Block in the province because they?re considered as vital national assets.

But Totoy also reminded BPMIGAS and the PSCs to properly communicate their projects to the public. ?Based on previous experiences, problems emerged because of the public?s lack of understanding on the activities of oil and gas contractors,? he said. (bernard)