“We expect to sign the PSC [production sharing contract] next year. The project is expected to be on stream 10 years after the PSC is signed,” Pertamina president director Karen Agustiawan said Friday.
On Friday, Pertamina signed a head of agreement (HoA) with Petronas and Total to jointly operate the block located in the South China Sea. Earlier on Dec. 2, Pertamina signed a similar deal with US-based ExxonMobil.
Karen said the HoA with ExxonMobil, Total and Petronas was still an early phase agreement to provide a basis for further cooperation.
“We will follow this with business-to-business talks. Afterward, the consortium will discuss the project’s terms and conditions,” she said.
Petronas’ advisor for the East Natuna project, Non Saputri, said the company was ready to contribute their technology.
“We have experience operating gas field with high degrees of CO2 in Malaysia,” she said. Asked about the size of the stake sought by the company in the project, Saputri said it was up to the Indonesian government to make that decision.
Currently, Pertamina and its partners have not declared the portion each company will get in the project, but Karen has repeatedly said Pertamina wanted majority share and to be the lead project operator.
She also said Pertamina required its partners to allow the state-owned company a share in their upstream assets.
Sealing the deal: Energy and Mineral Resources Minister Darwin Zahedy Saleh (second left), accompanied by oil and gas director general at the ministry Evita Legowo (left) and Upstream Oil and Gas Regulatory Agency chair R. Priyono (third left), witness the signing of oil and gas exploration contracts for South Sokang, Sokang and Wokam II in Jakarta on Friday. Agreements on the appointment of Petronas and Total were also signed. Antara/Yudhi Mahatma
Pertamina is in talks with Total for the acquisition of part of Total’s stakes in the Mahakam gas block in East Kalimantan. The Mahakam block has an estimated gas reserve of 11 trillion cubic feet. Total operates the block with a 50 percent share in partnership with Japan’s Inpex, which controls the remaining 50 percent.
Pertamina also expected a slice of ExxonMobil’s overseas upstream assets, Karen said Dec. 9. On Friday, Karen said a similar asset swap was also expected from Petronas.
The East Natuna gas field, formerly known as the Natuna D. Alpha, has been an important project for Indonesia due to its huge gas reserves. Located in the South China Sea, the Natuna D-Alpha block is estimated to contain 46 trillion cubic feet of gas, making it the biggest gas reserve in Asia.
While waiting for the East Natuna project to go on stream, Indonesia expects to tap another large offshore gas project, the Masela gas field in the Arafura Sea. Inpex owns 90 percent of the project, while local energy company PT Energi Mega Persada owns the remaining 10 percent.
Upstream oil and gas regulator BPMigas approved the project’s plan of development (POD). BPMigas chairman R. Priyono said the upstream development and the construction of the LNG facilities would require an investment of US$5 billion. He said the project was expected to go on stream by 2016.