Maluku says to be appointed to farm-in Masela block

Maluku provincial government said it has been okayed by Ministry of Energy and Mineral Resources to farm-in 10 percent interest in Masela Gas block, which is operated by Japan firm Inpex Corporation.

Governor Karel Ralahalu told Petromindo.com on Wednesday that he expected formal appointment would be issued by the ministry ?soon?.

According to Karel, the provincial government has formed a joint venture with a private company called PT Masela Energi to farm-in the block. Under the JV, the company owned by the administration will have 51 percent stake with Masela Energi holding the balance.

Karel said that Masela Energi will shoulder all financial obligation the JV?s portion of the block, including paying sunk costs and future cash calls. He did not disclose the ultimate shareholder of Masela Energi.

Inpex is planning to develop a floating LNG plant in Masela with initial capacity of 2.5 MTPA with production seen to start in 2018. Inpex currently holds 90 percent interest in the block with the balance held by IDX-listed oil, gas firm PT Energi Mega Persada Tbk, which is controlled by the powerful Bakrie family.

Under the Oil, gas Law, Indonesian-owned company which is appointed by the Ministry of Energy has right to farm-in 10 percent interest in any block after the first plan of development (PoD) is approved. The Masela offshore block is located closest to Maluku province.(alex/godang)