Pertamina seeks higher CBM price, tax incentives from govt

State-owned oil and gas firm PT Pertamina is seeking for higher coal bed methane (CBM) price from the government or tax incentives to make its CBM development projects economically feasible, reports said on Wednesday.

Pertamina Upstream Director Muhammad Husen was quoted by Bisnis Indonesia as saying that drilling programs at its CBM wells in South Sumatra and Kalimantan showed lower than expected results so far. Thus to make the project feasible the existing CBM selling price of US$6 per mmbtu must be either increased, or the government provides tax incentives. He added that the $6 per mmbtu price would not be enough to cover production cost.

He said the company has drilled 10 CBM wells at its working areas. The latest drilling program at ABK3-D001 core ole and exploratory well in Muara Enim, South Sumatra, showed result only half of what has been targeted.

?We will talk with the government to achieve the economical price,? he said. (*)