Pertamina: Total wants to participate in Mahakam block

Petromindo

State-owned oil and gas firm PT Pertamina claims that Total E&P Indonesie (TEPI) has expressed interest to continue participate in the development of the Mahakam block after its current contract expires at the end of this year, but demanded certain conditions, Kontan reported on Thursday.

The paper quoted Pertamina Upstream Director Syamsu Alam as saying that TEPI had expressed the interest informally, and the state firm is currently waiting for the former letter. He, however, did not disclose the conditions demanded by TEPI.

The government has decided to transfer the Mahakam block, in East Kalimantan Province, to Pertamina when the current contract of operator TEPI and its partner Inpex Corp expires at the end of this year. Pertamina has said it was willing to allocate 30 percent participating interest in the block to the current investors under a new contract for the block to be operated by the state firm.

But Deputy Minister of Energy and Mineral Resources Arcandra Tahar said on April 10 that TEPI had informally asked for participating interest of 39 percent in Mahakam block as part of conditions for the company to continue its role in the block after its current contract expires.

But he said that the government is still waiting for a formal letter from TEPI regarding the demand.

Minister of Energy and Mineral Resources Ignasius Jonan said last month that there is possibility for the current investors to have up to 39 percent of interest in the block after the current contract expires, and for TEPI to maintain operatorship status under a joint operatorship with Pertamina. Jonan said that the new offer is to help avoid production decline in Mahakam after the block is transferred to Pertamina.

But Syamsu reiterated that Pertamina is only willing to allocate up to 30 percent interest in Mahakam to TEPI and Inpex. (*)