ExxonMobil optimistic on Cepu deal

U.S. oil giant ExxonMobil Corp. is optimistic that a joint operating agreement (JOA) between the company and state oil and gas firm PT Pertamina over who will be in charge of managing the oil-rich Cepu block will be reached soon.

"We are hopeful of resolving it and there has been progress made in the negotiations. We expect a deal to be reach sooner rather than later," ExxonMobil Indonesia president director Peter Coleman said after a gathering of investors at the Presidential Palace on Friday.

Coleman said the company had been actively negotiating to seal a deal.

Talks over the JOA have become deadlock with both ExxonMobil and Pertamina holding out for principal control of the block, despite a memorandum of understanding (MOU) signed in June by the two companies and the government-sanctioned team that granted ExxonMobil the right to be the sole operator of the block for the entire duration of the contract.

The team managed to get ExxonMobil and Pertamina to sign a production sharing contract with the government on Sept. 17 to develop the US$2.6 billion Cepu block, which contains estimated reserves of 500 million barrels of crude oil. -- JP