Bimantara wins oil, gas contract
Bimantara wins oil, gas contract
JAKARTA (JP): PT Citraduta Samudra, a subsidiary of the
Bimantara Group, became the first domestic private company to win
an oil and natural gas production sharing contract with the state
oil company Pertamina.
Citraduta was one of the four contractors awarded hydrocarbon
production sharing contracts by Pertamina yesterday. The other
three are Santa Fe Resources (Bangko) Ltd. of the United States,
Bow Valley Ltd. of Canada and a consortium of Union Texas
(Barakan) Ltd. of the United States and Total Barakan of France.
"The Citraduta deal ushers in a new era of oil production for
domestic private business entities," Minister of Mines and Energy
I.B. Sudjana said, who witnessed the contract signing.
The widely-diversified Bimantara Group, one of the country's
largest business conglomerates, is chaired by Bambang
Trihatmodjo.
Sudjana asked Citraduta, as a newcomer in the upstream
petroleum industry, to learn as much as possible from foreign
companies, which have so far dominated the oil and gas
exploration and production field in Indonesia.
Yesterday's deal allows Citraduta to explore for oil and gas
in the 6,670-square-kilometer offshore area at Sepanjang Bloc,
East Java.
Bambang, who signed the contract for his company, told
reporters that, "It is time now for national companies, like us,
to break through the upstream petroleum business."
But he conceded that foreign partners have so far helped his
companies to grow up.
"British Petroleum and Atlantic Richfield Corp., for example,
are now our partners in the natural gas field in Pagerungan
Island off the coast of East Java," he added.
Investment
Under the agreement, Citraduta is committed to investing
US$23,50 million for the first 10 years of exploration in its
concession area.
Santa Fe, which was awarded a 3,846-square-kilometer onshore
area at Bangko Bloc in Jambi, plans to invest $27.90 million
during the first 10 years of exploration. Union Texas and Total
Barakan, which got an 800-square-kilometer field offshore
Southeast Maluku, will jointly invest $12.87 million during the
first 10 years, and Bow Valley will spend $2.80 million in its
650-square-kilometer area in Cenako, Riau, during the first six
years of its exploration activities.
Duane C. Radtke, president of Santa Fe, told The Jakarta Post
yesterday that his company -- which also holds several concession
areas in the southern part of Surabaya, covering a number of
regencies such as Gresik, Lamongan and Tuban -- will use its own
equity funds to finance its exploration activities in the new
area.
Bambang said that his company will likely tap foreign loans
for developing its new exploration area. "But, I cannot give you
details right now," he added.
Pertamina's director for production and exploration Priyambodo
Mulyosudirjo told the Post that the government is now finalizing
three new production sharing contracts for oil and gas
exploration and production and another contract under technical
assistance agreements.
He added that Pertamina is now processing bids from 15 new
contractors for oil and gas exploration and production.
Pertamina, which signed only four contracts last year, awarded
early this year four technical assistance contracts as well as
another huge deal with Esso Natuna Inc. of the U.S. for the
construction of a $35 billion gas liquefaction project in Natuna,
Riau.
Refinery
Bambang also told reporters after yesterday's ceremony that
one of his subsidiaries, PT Asia Pacific Petroleum, also plans to
construct an oil refinery in Situbondo, East Java, with a
processing capacity of 210,000 barrels of oil per day.
"We expect to start the construction next year," he said.
He said his company will cooperate with an Australian company
for constructing the export-oriented refinery, which will process
crude oil from Middle Eastern countries.
"We estimate the investment of the project will be Rp 3.5
trillion," he added.
The planned refinery is one of seven oil processing plants,
which were approved by the Investment Coordinating Board last
year. (fhp)