Riau finally obtains approval to operate CPP oil block
Wednesday, August 16 2000 - 03:30 AM WIB
The Riau province has finally obtained an approval from the ministry of mines and energy to take over the management and operation of the Coastal Plain Pekanbaru (CPP) oil block, a government source said.
The secretary of the province's technical team for the takeover of the oil block Edi Syahputra confirmed the approval Tuesday, saying that the ministry had accepted the province's proposal to take over the management of the oil bock from PT Caltex Pacific Indonesia (CPI) once the current contract ends in August, next year.
"We are now waiting for the signing of the contract for the formal handover of the CPP operation and management to Riau province," he told Berpolitik.Com. He added Riau would operate the oil block under a joint operation contract with state owned oil company Pertamina.
Eddy said Pertamina, which acts on the behalf of the central government would receive 85 percent of the oil production while the local government would receive the remaining 15 percent.
He said that the provincial administration would control about 70 percent of the 15 percent allocation while the province's partner in operating the oil block would get the remaining 30 percent.
The local government has recently established a special company to represent it in the CPP management but it has yet to select which companies it will cooperate with in operating the oil block.
Several local companies have expressed their interest to join the CPP management. The ministry of mines and energy has also recommend Pertamina as the province's partner but the local government has yet to give a firm response to their offers.
The secretary of the local government Tengku Lukman Harun said that the province would soon open a tender to select the partners. "But the priority might be given to PT Caltex Pacific Indonesia," he added. (*)