Exxon top executives meet Megawati

Fabiola Desy Unidjaja and A'an Suryana, The Jakarta Post, Jakarta

ExxonMobil Oil top executives met with President Megawati Soekarnoputri on Thursday to discuss the company's oil project in Cepu, Central Java, and security matters in Aceh, where its massive gas fields are located.

But there has also been speculation that the visit was mainly aimed at lobbying Megawati to approve the company's request to extend the contract of the lucrative Cepu oil fields. State-owned oil and gas firm Pertamina has demanded tougher requirements for the extension of the contract.

The visit was made following heightened tension in the troubled province of Aceh.

"We just talked about investment opportunities that ExxonMobil is currently pursuing, including our operation in Aceh, our business progress in Cepu and for the longer term in the East Natuna natural gas project," ExxonMobil Oil president H.J. Longwell said following the meeting.

Concerning Aceh, Longwell said there was no detailed discussion over whether it was necessary for the government to increase the number of military troops in Aceh in a bid to ensure security of the company's gas fields in the troubled province.

ExxonMobil was forced to shut down its gas operation in Aceh from March to July last year due to threats to security from the Free Aceh Movement.

"We just talked about ongoing security issues, and what kind of steps should be taken by the government and Pertamina to assure security in the area," Longwell said.

Security in Aceh has been a huge concern for the government. The Indonesian Military has taken a tougher stance as the violence there has escalated. Thousands of locals were killed during the military's presence in Aceh for 10 years. The Free Aceh Movement are still operating, and they have killed a number of security personnel, who were deployed in Aceh.

Longwell declined to provide comments on Exxon's plan to extend the contract to manage the Cepu oil field.

Reports have said that Exxon wants to extend the contract until 2030. The contract was supposed to end in 2010.

But Pertamina has demanded a greater share of the Cepu field plus a cash bonus as preconditions for the extension of the contract.

Pertamina has demanded tougher requirements after the government oil and gas research institution (Lemigas) found out that the Cepu has oil reserves of about 500 million barrels, much higher than the 250 million claimed by Exxon.

Longwell was reluctant to shed any light on the issue.

"It is too early to be specific on the number of reserves in Cepu. We need to do more, to be more specific," he said.

One source said that the government was near to reaching an agreement with Exxon to extend the Cepu contract.