Operators seeks to secure plots from Perhutani to speed up Cepu development

Operators of the Cepu block are in talks to secure a plot of commercial forestry concession controlled by state-owned forestry firm PT Perhutani after facing difficulties in purchasing public lands, The Jakarta Post reported Friday.

Energy and Mineral Resources Minister Purnomo Yusgiantoro said Thursday the operators were still negotiating with Perhutani after encountering problems in securing-land around the oil concession project.

According to R. Priyono, who has been proposed by the House of Representatives to become the new chairman of upstream oil and gas regulator BPMIGAS, the operators wanted to secure around 960 hectares of the Perhutani concession.

?Everything is now on the right track,? he said, adding the government had seen no other reason, aside from the land procurement, for the operators not to be able to meet the deadline set for the block?s production.

U.S. energy giant Exxon Mobil Corp. and state-owned oil and gas company PT Pertamina are the operators of the Cepu block, which is estimated to hold 600 million barrels of oil and 1.7 trillion cubic feet of gas reserves.

The government has set a target for the operators to produce 20,000 barrels of oil per day by the end of 2008, following an agreement to fast-track the development of the block. (*)