Total completes drilling of six wells in Mahakam block: SKK Migas

By Febry Silaban

Courtesy of SKK Migas

Total E&P Indonesie (TEPI), operator of the Mahakam block in East Kalimantan Province, has recently completed its plan to drill six wells in the block this year.

This was said by Head of Well Maintenance and Drilling Operation Division at upstream oil and gas authority SKK Migas Ngatijan to Petromindo.com on Tuesday.

The current contract of TEPI and partner Inpex Corp over the Mahakam block is set to expire end of this year, after which the operatorship of the block will be transferred to state-owned oil and gas firm PT Pertamina.

TEPI has agreed to allow Pertamina to start making investment in the block this year as part of a transition process to help maintain production level when the latter takes over the block next year. As has been previously reported, a total of 25 wells in Mahakam block are planned be drilled this year, of which 19 to be drilled by Pertamina, and six by TEPI.

But SKK Migas Chairman Amien Sunaryadi said late last week that Pertamina may back down from its plan to drill 19 wells in the block as the Ministry of Finance considers to impose value added tax, an additional financial burden that would affect the commercial feasibility of the Pertamina drilling plan. Pertamina plans to discuss this over with the Ministry of Finance.

Editing by Reiner Simanjuntak