Sele Raya to be acquired by Chinese company
Saturday, October 21 2017 - 02:42 AM WIB
The owner of PT Sele Raya plans to sell its entire shares in the oil firm to a Chinese company amid deteriorating investment climate in the country?s upstream sector, according to an industry source.
"All shares of Sele Raya will be acquired by a Chinese company called Jindy Union Energy. This is done because the conditions of investment in this country is not comfortable anymore," the source said to Petromindo.com on Friday.
However the divestment plan may face obstacle following the issuance of new Minister of Energy and Mineral Resources Regulation No. 48/2017 on Control of Enterprises in the Energy and Mineral Resources Sector.
"According to the new regulation, the company can execute the transfer of shares if it has obtained share transfer permit in advance from minister of EMR and BKPM," the source said, referring to the Ministry of Energy and Mineral Resources and the Investment Coordinating Board.
Meanwhile, Secretary of upstream authority SKK Migas, Arief Handoko, said that not all the blocks owned by Sele Raya will be sold.
"Only a portion of the Merangin II block are taken, that is 44.6%,? Arief said.
Sele Raya have three blocks in Indonesia, two of which are production blocks. Production comes from Belida block, onshore South Sumatra, and Merangin II block in South Sumatra. Sele Raya has a 46 percent interest in the Belida block, while Chinese firm Sinochem and Indian firm Tata Petrodyne Limited hold 40 percent and 14 percent, respectively. The Merangin II block was awarded to Sele Raya in October 2003. Sele Raya operates the block with a 44.6 percent interest, while the remaining is held by Merangin B.V. (35.4percent) and Sinochem Merangin Ltd. (20 percent).
The Blora exploration block was awarded to the company in 2009 and the firm holds a 100 percent interest in the block.
Editing by Reiner Simanjuntak