Minister Regulation on contract extension to be completed this year

The Government of Indonesia targeted the Energy and Mineral Resources Minister Regulation on Contract Extension for oil and gas contractors to be issued this year. This regulation would become the basis for the Government in processing the applications for contract extension submitted by work contractors.

Director General of Oil and Gas in the Ministry Evita Legowo said that the draft was nearly complete in the era of former Minister Darwin Saleh, and has been picked up by the current Minister Jero Wacik with a target of completing it within this year.

The regulation would stipulate the system of contract extension, including the terms and conditions. It also would stipulate the priority given to state energy firm PT Pertamina.

One of the blocks currently under review for contract extension is the Mahakam Block operated by Total E&P which would end in 2017. Total started operating the block on March 31, 1967 under a 30 year term. When the first contract ended in 1997, the Government extended the contract for 20 years until 2017.

The contract extension of the Mahakam Block is among the priority issues the oil and gas upstream sector of the Energy Ministry to decide upon this year.

Editing by Roffie Kurniawan