RI?s first shale gas PSC to be signed in November

By Romel S. Gurky

The government is expected to sign the country?s first shale gas production sharing contract (PSC) with contractor state-owned oil and gas firm PT Pertamina in November, according to Naryanto Wagimin, Director for the Management of Upstream Oil and Gas Sector.

?We?ll introduce national company as the pioneer,? he said Wednesday on the sidelines of a seminar on energy in Jakarta.

He added that further discussion on the planned shale gas PSC will take place this week among others discussing the revenue sharing mechanism between the government and the contractor. Naryanto said that Pertamina has asked for a greater revenue share.

There?s been quite huge interest from investors to develop the shale gas sector in Indonesia. To date, the government has received 64 proposals for a joint study on shale gas development in Sumatra, Sulawesi, Kalimantan and Papua. Of the total 64 proposed joint studies, five have been completed, and two joint studies are still in progress. Four proposals have been rejected.

Shale gas potential in Indonesia is estimated at about 574 tcf, higher than the CBM and natural gas potential of 453.3 tcf and 334.5 tcf, respectively.

Based on the identification process made by the government, there are so far 7 basins in Indonesia containing shales, one of which is in klasafet formation. There are 3 basins in Sumatra including Baong Shale, Telisa Shale and Gumai Shale.

Editing by Reiner Simanjuntak