Riau will not involve Caltex, if it allowed to take over CPP
Thursday, February 24 2000 - 02:32 AM WIB
Riau will no longer involve PT Caltex Pasific Indonesia (CPI) in the future operation of the Coastal Plains Pekanbaru (CPP) block if the province is allowed to take over the management and ownership of the oil field, Governor Saleh Djasid said on Wednesday.
"We will cooperate with a local company but not with Caltex. It is over for Caltex after 2001," the governor said to journalists following a meeting with Minister of Mines and Energy Susilo Bambang Yudhoyono.
The governor expressed optimism that the central government would allow the provincial administration to take over the management and ownership of the oil block when it expired in 2001.
He said the response from the government regarding the province's demand to take over the management and the ownership in the oil block, which produces 78,000 barrels of crude oil per day, was very encouraging.
Caltex recently said that it backed the Riau provincial administration's demand to take over a full ownership of the oil block and it was ready to operate the oil mining in cooperation with the local government. The company later denied the statement.
The governor said that he had yet to discuss the percentage of the stake in the oil block that must go to the Riau administration during the meeting with Bambang as the issue was being discussed by the government.
The provincial demand to take over the ownership of the oil block have received full support from the local legislative assembly and the House of Representatives (DPR), which have urged the government to heed with such demand.
DPR members asked the central government through the state owned oil company Pertamina to share the ownership with the local government.The CPP oil block is operated by Caltex under a 30 year production sharing contract with Pertamina. The oil block production is about eight percent of the total Caltex oil output from the province. (*).