SKK Migas completes recommendation on Lirik, Siak blocks

By Godang Sitompul

Upstream authority SKK Migas has submitted its recommendations regarding the fate of the Lirik and Siak oil and gas blocks in Riau to the Minister of Energy and Mineral Resources Jero Wacik as the existing contracts will expire at the end of this month.

The minister, however, has yet to decide on the fate of the contracts. The Siak block is currently operated by Chevron Pacific Indonesia, while Lirik by Medco Energi Internasional.

SKK Migas Spokesman Elan Biantoro told Petromindo.com Tuesday that his office would be forced to suspend the operations at the two blocks if the existing contracts are not extended when it expires latter this month.

Elan declined to disclose the recommendations made by the SKK Migas.

The SKK Migas statement, however, contradicts with the statement made by Upstream Director at the Directorate General of Oil and Gas, Hendra Fadly, who said that when the government fails to make a decision by the end November deadline, the operation of the two blocks will be temporarily handed over to the existing contractors until definitive operators have been appointed.

Meanwhile, a source told Petromindo.com that a company linked to retired Army General Luhut Panjaitan has also expressed interest to takeover the operation of the Lirik block when the existing contract expires. Meanwhile, companies owned by provincial government of Riau and Siak Regency administration have expressed intention to takeover the Siak block.

Editing by Reiner Simanjuntak