Kalla warns lawmakers off Cepu<\/p>\n
Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
Lawmakers' opposition to the ongoing negotiations to resolve a
\nserious contract dispute over the Cepu oil block between state
\noil and gas firm Pertamina and U.S. company ExxonMobil has irked
\nVice President Jusuf Kalla.<\/p>\n
Kalla has responded by telling legislators \"not to interfere
\nin the government's domain\".<\/p>\n
\"There is no way that a negotiation process by the government
\nwith another party can be conducted jointly with legislators.
\nSuch a process is part of the government's domain, and
\nlegislators should not interfere,\" he said on Thursday.<\/p>\n
Kalla was not at all pleased with the decision made during
\nWednesday's hearing between the House of Representatives'
\nCommission VII for energy and mining and Pertamina, wherein they
\nall agreed to oppose any outcome resulting from the negotiations.<\/p>\n
The legislators argued that their opposition was sparked by
\nthe \"questionable establishment of the negotiating team\", in
\nwhich the members were appointed without an official government
\nletter.<\/p>\n
They also questioned Pertamina about the negotiating team as
\nit was not clear whom they were representing.<\/p>\n
The commission also grumbled that the negotiations should be
\nentirely handled by Pertamina executives, since it was a
\nbusiness-to-business dispute instead of a government-to-business
\nproblems.<\/p>\n
Despite the rejection, Kalla insisted that the government
\nwould go ahead with the ongoing process for the sake of the
\npeople's welfare since the Cepu block -- which is located on the
\nborder of Central Java and East Java and owned by Pertamina but
\noperated by ExxonMobil Indonesia under a technical assistance
\ncontract set to expire in 2010 -- has a great amount of oil
\nreserves.<\/p>\n
The Cepu block is estimated to have two billion barrels of
\npotential oil reserves and 11 trillion cubic feet of potential
\ngas reserves, which is expected to increase Indonesia's oil
\noutput by 18 percent. Output has been declining over the last
\nfive years.<\/p>\n
\"If the government wants to create state losses for personal
\ngain, we could have made it last year and bowed to (ExxonMobil's)
\ndemands,\" Kalla said, referring to the extension of the contract.<\/p>\n
President Susilo Bambang Yudhoyono asked both companies to
\nreach an agreement by May 20 to end the dispute that has stalled
\nthe development of the Cepu block since 2001.<\/p>\n
Pertamina agreed to extend a contract only for the Banyu Urip
\nfield, the largest in the Cepu area, and demanded a 70 percent
\nparticipating interest in the field, President Director Widya
\nPurnama said on Wednesday, Bloomberg reported. The firm also
\nwants Exxon to pay all of the $1.6 billion needed to develop the
\nfield in the first three years.<\/p>\n
Members of the Cepu negotiating team<\/p>\n
* Martiono, Pertamina president Commissioner,<\/p>\n
* Muhammad Abduh, Pertamina commissioner<\/p>\n
* Umar Said, Pertamina commissioner<\/p>\n
* Mustiko Saleh, Pertamina vice president director<\/p>\n
* Sahala Lumban Gaol, Ministry of Finance's director for oil and
\ngas revenue.<\/p>\n
* Lin Che Wei, staff expert at the office of the State Minister
\nfor State Enterprises<\/p>\n
* Mohammad Ikhsan, staff expert from the office of the
\nCoordinating Minister for the Economy<\/p>\n
* Rizal Mallarangeng, political analyst<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/kalla-warns-lawmakers-off-cepu-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }