Genting unit signs exploration pact

Dow Jones Kuala Lumpur

Malaysia's Genting Bhd. late on Friday said its unit Sanyen Oil & Gas Ltd. signed a 30-year production sharing contract with Indonesia's BP Migas for the Anambas Block.

The Anambas Block is over 3,200 square kilometers in size and is located within the natural gas-prone area of West Natuna in Indonesia, Genting said in a statement to Bursa Malaysia.

Genting said Sanyen will hold a 100 percent stake in the Ambas production sharing contract.

"The work program for the first three years of the exploration period of this production sharing contract will include the acquisition of new 3D seismic data and the drilling of one exploration well," Genting said.

BP Migas is the Executive Agency for Upstream Oil and Gas Business in Indonesia.

Rachmat Sudibyo, the head of BP Migas confirmed the signing. However, he failed to give details on how much production split for Sanyen.

"The Ministry of Energy and Mineral Resources negotiated the deal," Rachmat told The Jakarta Post.

Anambas block had been offered to investors through direct offering instead of open bidding.

Direct offering to investors is one of the government program to attract more investors into oil and gas exploration in a bid to lift sagging crude output.

Indonesia's crude output now stands 1.072 million barrels a day, lower than output quota set by the Organization of Petroleum Exporting Country (OPEC). Indonesia is the only southeast Asian countries in OPEC's membership.

The government has just launched an open bidding for 10 oil and gas acreages in June. Bidding result will be announced in October followed by contract signing.