Sudirman: Masela PSC should be extended

By Febry Silaban

Minister of Energy and Mineral Resources Sudirman Said suggested on Thursday that the government might extend the contract on Masela block in Maluku province held by Inpex Corp and Royal Dutch Shell.

Sudirman said the Masela contract expires in 2028. Assuming that the Masela block will start production in 2024 and the government refuses to extend the contract, that means the contractors will only get benefits from the block for only four years, which is unacceptable for the contractors.

?A good policy is always reasonable. Logically, there must be an extension. However, the (contract extension) process has not started yet,? Sudirman told reporters.

He noted that he does not guarantee that the contract will be extended. Logically, however, the contract on Masela should be extended beyond 2028.

?If it is not extended, it (the block) is not feasible (for development) in terms of investment,? Sudirman said.

Inpex has repeatedly asked for extension of its contract but the government has thus far refused to extend the contract on the grounds that the firm has yet to secure contracts with buyers.

Meanwhile, SKK Migas? Chairman Amien Sunaryadi said following the President?s decision, Inpex has informed the agency that it will most likely ask for several incentives for the development of Masela.

He noted however that thus far SKK Migas has not received a request from Inpex for a change in the production split of the block.

Editing by Johannes Simbolon