Half of the 21 oil and gas blocks offered by the government last year failed to attract investors due primarily to inaccurate data, unfavorable locations and a lack of technology available to tap the resources, an official says.
Energy and Mineral Resources Ministry director general of oil and gas Evita H. Legowo said the numbers of sold and unsold oil and gas blocks were equal.
"We don't know exactly why some blocks didn't attract any investors. It could have been that investors had doubts about the data or maybe they needed more advanced technology to operate the blocks on offer," Evita said, refusing to name the blocks remaining unsold.
She also mentioned geographic location as a potentially discouraging factor.
The government is slated to open a new bid for oil and gas blocks in October or November this year, and will probably include those leftover from last year.
"We are still formulating which blocks we will offer. We are also still deciding whether the unsold blocks would be offered again or not," Evita said.
Indonesia recorded Rp 34.4 trillion (US$3.73 billion) of tax revenue from the oil and gas sector, with some Rp 36 trillion expected for this year.
In May 2007, the government auctioned 21 oil and gas blocks: North X Ray Block in West Java; N. E Lombok I and N.E Lombok II blocks in Nusa Tenggara; Semai I, Semai II, Semai III, Semai IV and Semai V blocks in West Papua; South East Tual block in Arafura; Cakalang block in Natuna; Kerapu, Baronang, Cucut, and Dolphin blocks in Nautana; Bawean II, East Bawean I, Gunting and Situbondo blocks in East Java; Buton II block in Buton; Rangkas block in Banten; and West Timor block in Timor. -- JP/Alfian