PT Pertamina Should Have Majority of Mahakam Block

By : Hariyanto And Aldo Bella Putra | Friday, September 29 2017 - 18:00 IWST

Anjungan di Blok Mahakam (ist)
Anjungan di Blok Mahakam (ist) - Jakarta - Energy and Mineral Resources Minister Ignasius Jonan affirmed that PT Pertamina (Persero) must control at least 51 percent or controlling majority of shares in Mahakam block, East Kalimantan.

"Pertamina must own 51 percent of the shares, while the remaining 10 percent is for regional ownership," said ESDM Minister in Jakarta on Thursday (28/9/2017)

As per the rules, as much as 10 percent of the "Participating Interest" (PI) or shareholding share must be submitted to the region. If 10 percent is owned by the region and Pertamina is required to own 51 percent then the remaining 39 percent stake in Mahakam block.

The 39 percent problem is that the Government fully surrendered to PT Pertamina, whether to "share down" with other companies or not. It will be agreed "business to business" (b to b).

In addition, the Government also requested two things to Pertamina related to the Mahakam Block. The first "cost recovery" or cost of production should not be greater than the cost of the current operator, Total E & P.

Second, the oil and gas production produced by Pertamina will not be less than that produced by Total E & P at this time. Even if it decreases it should be discussed with the government first in order to provide logical certainty of the achievement of production.

PT Pertamina (Persero) through Pertamina Hulu Mahakam has been appointed by the government to be the manager of the Mahakam Block working area effective January 1, 2018, after the expiry of Mahakam's Production Sharing Contract (PSC) in the management of Total E & P Indonesie by the end of 2017.

At the end of 2017, Total E & P Indonesie agreed to terminate the contract with Mahakam Block, its continuation as operator or still have shares will be discussed with PT Pertamina in a "b to b" manner. (Ant)

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