Pertamina to get 100% ownership of ONWJ block

Minister of Energy and Mineral Resources Ignasius Jonan has decided to transfer the entire ownership over ONWJ block in West Java Province to state-owned oil and gas firm PT Pertamina when the current contract expires on January 18, 2017, Kontan reported on Monday.

The paper said that Pertamina will hold a new contract that is valid until 2037.

The paper quoted Director General of Oil and Gas at the ministry IGN Wiratmaja Puja as saying that the minister has sent a letter on the decision to upstream authority SKK Migas.

He added that existing investors in the block who wish to continue participating in the block under the new extended contract must buy the shares in the block through business-to-business deal with Pertamina.

Wiratmaja also said that the government has also decided to allocate 10 percent participating interest in the ONWJ block to the West Java provincial administration, which has assigned provincial owned company PT Migas Hulu Jabar, which will later hold talks with Pertamina to realize the acquisition of the participating interest.

Pertamina currently holds a 58.27 percent interest in ONWJ block as operator, while Kuwait Foreign Petroleum Exploration Company (Kufpec) owns 5 percent interest, and PT Energi Mega Persada (EMP) has more than 36 percent.

The government initially planned to increase Pertamina?s interest in the block to 72.5 percent when the ONWJ block contract is extended, reducing Kufpec?s shares to 2.5 percent and EMP?s to 24 percent. Kufpec has decided to no longer participate in the block under the new contract due to the reduction in its interest in the block.

EMP could not be reached for comment. (*)