Pertamina asked to negotiate with Exxon over Block A takeover plan
Friday, August 26 2005 - 01:54 AM WIB
?Any companies interested in taking over the Block A, they should negotiate with EMOI and ConocoPhillips as interest holders of the gas block, not with the government,? he was quoted as saying by the newspaper.
The director general assured that the government would not interfere in the two oil and gas giants? divestment plan in the Block A gas field because it would be the right of the operator whether or not it would continue the development of the gas field.
State owned oil and gas company Pertamina has expressed its interest to take over the ownership of ConocoPhillips in the Block A gas field in Aceh.
The Block A gas field is equally owned by ConocoPhillips and ExxonMobil. But ConocoPhillips has refused to develop the gas field despite the government?s offer to give them a bigger production split from the gas field?s production.
ExxonMobil has expressed intention to sell its interest in Block A had two local firms PT.Energi Mega Persada and PT.Medco Eenergi Internasional Tbk. has expressed interest to buy.
The government has offered ConocoPhillips and ExxonMobil 48 percent production split from the Block A gas field, much higher than the average 30 percent given to existing gas producers. The two oil and gas giants have instead demanded 50 percent split.
The government hopes that the development of the Block A gas field would help cope with the shortage of the gas supply to the Arun LNG plant and Pupuk Iskandar Muda and AAF fertilizer plants.
The gas production of the existing Arun gas field operated by ExxonMobil is only enough to meet the Arun LNG plant?s long-term export commitment. (*)