ExxonMobil commits to Cepu MOU

U.S. oil giant ExxonMobil Corp. has renewed its commitment to comply with its memorandum of understanding (MOU) and production sharing contract (PSC) with the Indonesian government before deciding to exploit the untapped oil-rich Cepu block.

Joint operators should comply with the deals that depict a clear revenue-sharing scheme and mechanism, said new Exxonmobil Indonesia president Peter J. Coleman during a visit to Bojonegoro on Tuesday.

"Exxonmobil will remain committed to developing the Cepu block. For sure, we want the exploration and exploitation of the field to be done as soon as possible," Coleman was quoted by Antara as saying.

Coleman and several ExxonMobil executives met Bojonegoro Regent H.M. Santoso to discuss the company's plan to manage the block, which contains estimated reserves of 500 million barrels of crude oil.

At present, ExxonMobil and state oil and gas firm PT Pertamina are wrangling in a dispute to seal a joint-operation agreement for the block, which is expected to start pumping out oil in 2008.

The agreement is needed to determine which of the two companies is authorized to operate the block.

Antara reported that during the meeting, the two parties also discussed a plan to acquire between 800 and 1,000 hectares of land located in the Ngasem and Kalitidu districts for managing the block, which is located between Central Java and East Java.

Neither officials from the regency nor ExxonMobil have confirmed the report.

Santoso only said the visit was just a courtesy call from Coleman, who was new in his post and wanted to personally get acquainted with him. -- JP