Pertamina to report Cepu dispute to President next week
Friday, December 9 2005 - 01:56 AM WIB
Pertamina's president dirctor Widya Purnama said in Jakarta on Thursday that in the meeting, Pertamina would discuss the future of the Cepu oil block with President, and several related ministers including Minister of Energy and Mineral Resourses Purnomo Yusgiantoro, Chief Economic Minister Budiono and State Minister for State Enterprises Sugiharto.
"I don't know whether Exxon will also join the meeting. I don't know yet," he told a hearing with members of the House of Representatives (DPR).
According to Widya, the meeting would discuss the problem related to the joint operating agreement (JOA) of the Cepu oil block. "But from our part, it is clear that we want to act as the operator for the first five years of the operation of the oil block," he said, adding that Pertamina is consistent that Pertamina and Exxon should take turns on the operatorship of the oil block.
The government recently signed the new contract for the development of the Cepu oil block with its operators Pertamina and ExxonMobil Indonesia recently after prolonged negotiations.
Under the new agreement, Pertamina and ExxonMobil will have participating interest of 45 percent in the Cepu oil block, each. The other 10 percent will be allocated to the local government which oversees the territory where the oil block is located. Both oil giants however want to become the operator of the massive oil block.
Pertamina later proposed Exxon to take turn on the operatorship for every five years but the proposal is opposed by Exxon, saying it has the rights to act as the sole operator until the end of the 30 year-contract.
ExxonMobil formerly operated the Cepu oil block under technical assistance contract with Pertamina. The contract should have ended in 2010 but the oil giant demanded the earlier extension of the contract for the certainty of its investment in the oil field for another 20 years. (Godang)