JP/13/AMBALAT
RI seeks clarification from Shell, Petronas over Ambalat
Fabiola Desy Unidjaja The Jakarta Post/Jakarta
Jakarta will seek explanations from oil giants Royal Dutch/Shell and Malaysia's Petronas about their involvement in the issue of sovereignty over the East Ambalat offshore block, which is claimed by Indonesia and Malaysia.
The two companies have been asked to attend later this week a series of meetings with the government, represented by the Upstream Oil and Gas Executive Agency (BP Migas) and the Ministry of Energy and Mineral Resources, and the House of Representatives.
"We need clarification of the business reasons behind the dispute, and to ensure that they were not using our data during their negotiations before agreeing to the concession (over the East Ambalat block)," Iin Arifin Takhyan, the Ministry of Energy and Mineral Resources' director general for oil and gas, said on Sunday.
Iin was referring to the contract agreed to between Petronas and Shell last month to develop and exploit the disputed area -- a move that heated up the sovereignty row between Indonesia and Malaysia over Ambalat.
Only months earlier, Indonesia awarded a similar contract to another multinational oil giant, Unocal.
But because Shell was also awarded the right to exploit the Ambalat block -- located next to the East Ambalat block -- by Indonesia in 1999, there is concern that Shell used data from Indonesia during its negotiations with Malaysia.
If the company did use the data, Iin said, it would be a violation of the 1999 agreement that stipulated all data regarding oil reserves and other specifications about the block must be returned to Indonesia in the event the contract was terminated.
Shell did terminate the agreement in 2001 and handed over the concession to Ambalat to Italian oil producer Eni.
"The agreement means Shell must not use our data to appraise the oil potential in the East Ambalat area," Iin said.
BP Migas chairman Rachmat Sudibyo said it was no surprise foreign companies wanted into Ambalat given the large oil potential in neighboring areas.
Separately, Andang Bachtiar, chairman of the Indonesian Geologists Association, estimated the oil reserves in Ambalat were between 100 million and one billion barrels. Such a large deposit would go a long way toward improving Indonesia's dwindling oil production.
These huge reserves were the key point in the dispute over Ambalat, according to Andang, who claimed that geologically speaking, the area belonged to Indonesia.
"The Ambalat area belongs to Indonesia as it is a part of the Tarakan Basin (in East Kalimantan). Malaysia extended its coastline to the south by 10 kilometers in 2002, claiming that it was an archipelagic state, while, in fact, it is not," Andang said.
Iin said that after receiving clarification from both Shell and Petronas, the government would decide on its next step.
"We will hear their explanation of the matter and then decide what we should do." (005)