Kontan Online

OIL AND GAS

Oil and gas block tenders lacked enthusiasts

Saturday, 31 December 2016 | Febrina Ratna Iskana

JAKARTA. Ministry of Energy and Mineral Resources (ESDM) recorded that the number of the winners of tenders on oil and gas blocks. This happened on the tenders of 14 oil and gas blocks. The tenders involved seven blocks under direct offer scheme, while seven other blocks are under regular scheme.

In terms of direct offer scheme, the government is recently conducting bidding process on three oil and gas blocks, including Ebuny Block, Onin Block, and West Kaimana Block. According to the Director of the Advisory of Oil and Gas Upstream at Ministry of ESDM Tunggal, the bidding winner will be announced by Director General of Oil and Natural Gas at the Ministry of ESDM IGN Wiratmaja Puja. “The winner will be announced in January 2017,” he said.

The other four blocks under direct offer scheme, such as Batu Gajah Block, Kasongan Sampit Block, Ampuh Block, and Bukit Barat Block have not yet been in demand. Therefore, those blocks will be auctioned off again in the next year.

Tunggal analyzed that the lack of interests of the oil and gas blocks was affected by the decrease in oil price so that the investors controlled the investment budget. Therefore, many investors could not meet the investment commitment, which is the administrative requirement.

Meanwhile, the government will continue offering seven oil and gas blocks under regular scheme. Those seven blocks include South CPP Block, Suremana I Block, Manakarra Mamuju, SE Mandar, North Argunim, and Kasuri II.

Tunggal said, several blocks are actually already in demand. Some investors, mainly foreign investors have purchased the bidding documents. “Statoil, Total Indonesia, and Aspect want to purchase the documents,” he said. So far, the government is still exploring the demands on those seven oil and gas blocks.

Vice President of Indonesian Petroleum Association (IPA), Ignatius Tenny Wibowo said, in general, the funds provisions for investment in oil and gas industry have decreased. Therefore, the investment competitions in many countries become tougher. “The fiscal term and other processes have to more attractive than other countries to attract investment,” Tenny said.

(Muhammad Farid/Translator)

Reporter: Febrina Ratna Iskana
Editor: Yudho Winarto
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