MITI hopes to complete acquisition of Benakat Oil before year-end

By Thomas Sembiring

IDX-listed PT Mitra Investindo Tbk (MITI) hopes to be able to complete the acquisition of PT Benakat Oil (BO) before the end of this year, and will focus on increasing oil production of the latter firm.

?For certain we?ll focus on increase the production of Benakat,? said MITI Director Diah Pertiwi Gandhi on the sidelines of company shareholders meeting on Friday, referring to BO?s subsidiary PT Benakat Barat Petroleum (BBP).

Diah said that BBP?s oil production is targeted to be increased to around 1,300 bopd from the current 600-700 bopd.

She added that MITI has paid about 40 percent of the total acquisition value of Rp 70 billion, financed via a combination of internal funds, loans and private placement.

MITI signed a conditional sale and purchase agreement on May 20 of this year with PT Pratama Media Abadi (PMA) and BO for the acquisition by MITI of 23.44 percent of the issued and paid-up share capital of BO and translates into an indirect holding of 21.79 percent of PT Benakat Barat Petroleum (BBP).

BBP is a limited liability company incorporated under the laws of Indonesia. Pursuant to an operations cooperation agreement (the Benakat Barat KSO) entered into between BBP and PT Pertamina EP on March 16, 2009, BBP holds an undivided 100 percent interest in the Benakat Barat KSO and has the rights and obligations to exploit, develop and explore for hydrocarbons in the Benakat Barat field in South Sumatra.

MITI has said that oil and gas business will become its main sole of revenue as the company has sold its granite concession on Bintan Island, a process that is also expected to be completed this year.

MITI currently owns the Linda Sele oil and gas field, in West Papua, following the acquisition of 90 percent shares of Goldwater LS Pte Ltd from Interra Resources Ltd in 2014. Last year, sales volume from the concession stood at 6,669 barrels. Production from Linda Sele is expected to increase this year.

Editing by Reiner Simanjuntak