Pertamina negotiating to buy up to 50% of Cepu block

State oil and gas company Pertamina?s president Baihaki Hakim said on Tuesday the state company is intensively negotiating with American energy giant ExxonMobil Corp to buy up to 50 percent stake in the latter?s oil and gas block in Cepu, Central and East Java.

?Pertamina is seeking to buy between 10 and 50 percent stake in the block,? Baihaki told reporters on the sidelines of the deliberation of the oil and gas bill at the House of Representatives.

He said the final number of stake Pertamina would buy depended on the price set by ExxonMobil and the financial capability of the state company.

He noted that the larger the number of stake owned by Pertamina in the block, the larger the cost to be covered by the state company to develop the block.

?The block is estimated to need a total of US$1.2 billion for full development,? he said.

ExxonMobil recently announced that it had discovered more than 250 million barrels of oil reserves in the block, from which the company will be able to produce up to 100,000 barrels of oil per day in 2004. (Alex)