Riau province seeks to take part in developing CPP block; Legislator wants Pertamina wholly owns CPP block
Tuesday, February 8 2000 - 04:00 AM WIB
The Riau provincial administration had asked the central government to approve its plan to take part in the development of the Coastal Plains Pekanbaru oil block in the province after the contract of American oil and gas company PT Caltex Pacific Indonesia expired in 2001, Suara Kita daily reported.
The provincial spokesman said the province was ready to continue developing the oil field either by itself or in joint ventures with Caltex or state oil and gas company Pertamina.
However, Neraca daily said legislator Ramson Siagian, a member of the House of Representatives' Commission VIII for mines and energy called on the government to transfer the whole development of the oil field to Pertamina after Caltex's contract expired.
He said the current negotiations between Pertamina and Caltex to form a joint venture to develop the field should be ended and the government should allow Pertamina to wholly handle the development of the field after Caltex's contract expires.
Ramson said the government should stick to the existing regulation stipulating that an oil field should be returned to the government after the contract on the field expired. The government decides whether to extend the contract or put it into tender.
"According an information that I have received, the government decided in 1997 to transfer the oil field to Pertamina, rather than to extend Caltex's contract. The decision was agreed upon by (then) President Soeharto and the board of commissioners of Pertamina. But the policy was revoked after the cabinet was changed. What's the matter? The reason for the change in the policy that Pertamina was unable to develop the oil field was unreasonable," Ramson said.
The decision to transfer the oil field to Pertamina was reviewed by former Minister of Mines and Energy Kuntoro Mangkusubroto in 1998, who believed Pertamina was not able to develop the field by itself.
Based on the recommendation given by the former House, President BJ Haibibie's administration ordered Pertamina to set up a joint venture to develop the oil field but thus far both parties had not yet reached an agreement on the share ownership of the field.
The CPP block currently produces around 70,000 barrels of oil per day. (*)